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Full text of "Evidence study"



NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 

EVIDENCE STUDY 
NO. 11 

OF 

THE ELECTRICAL MANUFACTURING INDUSTRY 



Prepared by 
J. R. PIKE 



December, 1935 



PRELIMINARY DRAFT 
(NOT FOR RELEASE: FOR USE IN DIVISION ONLY) 



THE EVIDENCE STUDY SERIES 

The EVIDENCE STUDIES were originally planned as a means of gathering evidence 
■Bring upon various legal issues which arose under the 'National Industrial Re- 
covery Act. 

These studies have value quite aside from the use for which they were originally 
intended. Accordingly, they are now made available for confidential \ise within the 
Division of Review, and for inclusion in Code Histories. 

The full list of the Evidence Studies is as follows: 



Automobile Manufacturing Ind. 23. 

.Boot and Shoe Mfg. Ind. 24. 

Bottled Soft Drink Ind. 25. 

Builders' Supplies Ind. 26. 

Chemical Mfg. Ind. 27. 

Cigar Mfg. Industry 28. 

Construction Industry 29. 

Cotton Garment Industry 30. 

Dress Mfg. Ind. 31. 

Electrical Contracting Ind. 32. 

Electrical Mfg. Ind. 33. 

Fab. Metal Prod. Mfg., etc. 34. 

Fishery Industry 35. 

Furniture Mfg. Ind. 36. 

General Contractors Ind. 37. 

Graphic Arts Ind. 33. 

Gray Iron Foundry Ind. 39. 

Hosiery Ind. 40. 
Infant's & Children's Wear Ind. 41. 

Iron and Steel Ind. 42. 

Leather 43. 
Lumber & Timber Frod. Ind. 



Mason Contractors Industry 

Men's Clothing Industry 

Motion Ficture Industry 

Motor Bus Mfg. Industry (Dropped) 

Needlework Ind. of Puerto Rico 

Fainting & Paperhanging & Decorating 

Photo Engraving Industry 

Plumbing Contracting Industry 

Retail Food (See No. 42) 

Retail Lumber Industry 

Retail Solid Fuel (Dropped) 

Retail Trade Industry 

Rubber Mfg. Ind. 

Rubber Tire Mfg. Ind. 

Silk Textile Ind. 

Structural Clay products Ind. 

Throwing Industry 

Trucking Industry 

Waste Materials Ind. 

Wholesale & Retail Food Ind. (See No. Si) 

Wholesale Fresh Fruit & Veg. 



In addition to the studies brought to completion, certain materials have been 
assembled for other industries. These MATERIALS are included in the series and^are 
also made available for confidential use within the Division of Review and for in- 
clusion in Code Histories, as follows: 



44. Wool Textile Industry 

45. Automotive Parts & Equip, 

46. Baking Industry 

47. Canning Industry 

48. Coat and Suit Ind. 



49. Household Goods & Storage, etc. (Dropped) 

Ind. 50. Motor Vehicle Retailing Trade Ind. 

51. Retail Tire & Battery Trade Ind. 

52. Ship & Boat Bldg. & Repairing Ind. 

53. Wholesaling or Distributing Trade 



L. C. Marshall 
Director, Division of Review 



y <\^\ 



CONTENTS Pa^e 

Foreword 1 

CHAPTER I - THE INDUSTRY 2 

Definition of the Industry ! 

History and Development. 2 

Competition with Other Industries 3 

Manufacturing Operations 3 

Total Number of Establishments 5 

Number of Establishments by Principal 

States 3 

Size of Establishment 4 

By Value of Product 4 

By Number of ".Tage Earners 5 

Capital Investment 6 

Net Profit or Loss 6 

Value of Production by Principal 

Product Groups 6 

Estimated Total Sales, by Principal 

Types of Product 7 

CHAPTER II - LABOR AND MATERIALS 9 

To tal Annual Eroploymen t c - 

Number of Wage Earners by Principal 

States 9 

Total Annual Payrolls 10 

Annual Wages by Principal States 11 

Hourly Wages 11 

Weekly Hours 12 

Weekly Earnings 12 

Employment, Hours, and Earnings 

Under the Code 12 

Labor Cost 14 

Materials Used 14 

Cost of Materials. 14 

CHAPTER III - PRODUCTION AND DISTRIBUTION 15 

Value of Production by Principal States • 15 

Distribution of Manufacturers' Sales 15 

Wholesale Sales 1- 

Exports I 7 

Advertising Media 12 



8881 -i- 



CONTENTS -(Concluded) 

Page 

CHAPTER IV - lEAEE PRACTICES 19 

CHAPTER V - TUB INDUS THY - GENERAL INFORMATION 22 

Trade Associations 22 

Labor Organization 22 

Imports 23 

Effect of the Code 23 



-oOo~ 



8331 



TABLE I 



TABLE II 



TABLE III - 



TABLE IV - 



TABLE 



V - 



TABLE VI - 

TABLE VII - 

TABLE VIII - 

TABLE IX - 

TABLE X - 

TABLE XI - 

TABLE XII - 

TABLE Ell - 

TABLE XIV - 

TABLE XV 

TABLE XVI 

TABLE XVII 



TABLES 

Faf.-e 

Electrical Energy Produced in Central 

Stations, for Selected. Tears, 1387-1933 3 

Number of Establishments, by 

Principal State s 4 

Number of Establishments and Value of 

Product, Classified by Value of 

Product r>er Establishment, 1929.. 5 

Number of Establishments and Number of 

Wage Earners, Classified by Number of 

Wage Earners per Establishment, 1929 5 

Total Value of Product by Principal 

Product Croups • 7 

Estimated Total Sales, by 

Principal Type of Product 8 

Estimated Total Domestic Sales, by 

Principal Type of Product, 1933 and 1934 8 

Estimated Total Annual Number of All 

Employees, and of Wage Earners 9 

Annual Average Number of Wage 

Earners, \>?j Principal States 9 

Processing Employees, by 

Principal States, 1934 and 1935 10 

Estimated Total Annual Payrolls of 

All Employees , and of Wage Earners 10 

- Total Annual Wages, by Principal States 11 

- Average Hourly Wages H 

- Average Hours Worked per Week 12 

- Average Weekly Earnings • 12 

- Factory Employment, Payrolls, Hours 
and Wages, 1933-1934 15 

- Relation of Labor Cost to Total Value 

of Product 14 

-iii- 



TABLES (Concluded) 



TABLE XVIII - Relation of Cost of Materials 

to Total Value of Product 14 

TABLE XIX - Value of Production, by 

Principal States 15 

TABLE XX - Distribution of Sales of 

Manufacturing Plants, 1929 1G 

TABLE XXI - lluraber of "Electrical" Wholesale 
Establishments and Value of llet 
Sales Reported by them, by 
Principal States, 1929 and 1933 17 

TABLE XXII - Value of Exports 17 

TABLE XXIII - Advertising Expenditures of Radio 

Manufacturers for Radio Broadcasting 

and Magazine Adver ti sements IS 



ELECTRICAL LIAinJEACTURIilG IiTDUSTEY 



Fore-word 



The data contained in this Evidence Study have "been 
obtained chiefly from the Census of Manufactures, the Bureau of 
Labor Statistics, and the former Code Authority for the Electrical 
Manufacturing Industry. 

As explained in Chapter I, the Census classification for 
this Industry is not identical with the Code definition, hut the 
Census data give a good general idea of the Industry as codified. 

The Labor data in Tahle XVI (Chapter II ), which were 
specially compiled "by the Bureau of Labor Statistics in cooper- 
ation with the ISA, Research and Planning Division, and most of 
the tables based on information supplied by the former Code 
Authority, pertain to the Industry as defined by the Code. 

Because of the small amount of data available in connec- 
tion with the section on raw materials, this section has been 
included in Chapter II. 



8881 



-2- 
Chapter I 
THE INDUSTRY 

Definitions of the I ndustry 

The Electrical Manuf acturing Industry is defined in the Code of Fair 
Competition for the Industry 

"..,„. to mean the manufacture for sale of electrical 
apparatus, appliances, material or supplies and such other 
electrical or allied products as axe natural affiliates." 

In the Census of Manufactures, the "Electrical Machinery. Apparatus, 
and Supplies" Industry is only roughly comparable with the Code Industry in 
scope. The Census classification does not cover establishments whose 
principal products are "electric lighting fixtures, electric signs, or motor 
driven tools, mechanical refrigerators, washing machines and other machines 
and appliances constructed with built-in motors." On the other hand, the 
Census data include establishments covered by codes other than that for the 
Electrical Manufacturing Industry, although approximately 05-90 per cent of 
the products in the Census classification in 1929 were covered by the Code. 
The usual limitation arising from the fact that the Census data do not in- 
clude establishments having an annual production of less than $5,000 must 
also be borne in mind. 

History and Development 

The Industry got its start in the latter part of the Nineteenth Century. 
Originally used primarily for telegraph and telephone communication, illumine 
tion, and electric transportation, electricity now plays a vital part in 
practically all of the activities of modern civilization. Each new use for 
electricity requires not only additional generating and distributing equip- 
ment resulting from the increased demand, but also additional electrical 
equipment and energy for use in the factories making the new electrical 
product. The growth of the Industry is indicated by the increased output 
of electrical energy. According to Table I, this has increased from less 
than 200 million kilowatt hours in 1887 to more than 80 billion in 1933, a 
four hundred-fold increase. 



8881 



-3- 

TABLE I 

Electrical Energy Proceed in Central Stations, 

for Selected Years, 1087-1933 

(in millions of kilowatt-hours) 



Year 








Output of 
Electrical Energy 


1887 








175 


1897 








800 


1907 








5,900 


1917 








25.400 


1927 








74,700 


1929 








91,400 


1933 








80^100 a/ 


Source: 


Electrical. 


florid. 


Jamiary 6, 1934, 



a/ Estimated on basis of 10 months' 
operations. 

Competition with Other Industries 

Competition with other industries is almost entirely limited to gas- 
operated devices, such as domestic refrigerators, cooking stoves, water heat- 
ers, industrial furnaces and ovens, and various small household appliances 
such as percolators and heaters. 

Manufacturing; Operations 

The Industry is so diversified that the manufacturing operations embrace 
practically all of the modern processes fcr working materials, and in many 
subdivisions of the Industry special manuf acturing processes have been de- 
veloped to meet problems that are peculiar to these subdivisions. 

Total Number of Establishments 

Although the data presented in Table II are not strictly comparable from 
year to year (see table footnotes) it may be stated that there has been a 
marked decline in the number of establishments from 1929 to 1933 with a slight 
increase in 1935. 

Numbor of Establishments by Principal States 

In 1933 about 60 per cent, and in 1935 over 75 per cent, of the total 
establishments were located in the eight states listed. The states having 
the largest number of establishments in 1935 were New York, Illinois, and 
Ohio in the order named. 



8881 



„4- 

TAELE II 

Number of Establishments, by Principal State 



State 


1939 


1931 


1933 


1935 a/ 


U. S. T h a l 


1,802 


l s 5 r r3 


1,363 


1,411 


Connecticut 


59 


58 


53 


66 


Illinois 


245 


221 


181 


197 


Indiana 


57 


44 


37 


34 


Massachusetts 


106 


102 


84 


89 


New Jersey 


151 


130 


99 


114 


New York 


287 


268 


213 


274 


Ohio 


211 


1(98 


160 


166 


Pennsylvania 


137 


130 


118 


136 


All Others 


549 


475 


408 


335 


Source: Census 


of Manufa 


stores, 


"Electrical 


Machinery, 



a/ 



Apparatus and Supplies," for 1929, 1931, and 
1933, and. in addition, "Radio Apparatus and 
Phonographs" for 1931 and 1933; Code Authority 
for 1935. Data for 1929 are not exactly com- 
parable with 1931 and 1933 since phonographs 
are included in Census data for the latter 
two years: and since the Census and Code cover- 
ages are nob identical, the 1935 data supplied 
by the Code Authority are not strictly compar- 
able with those fo.." the previous years. Census 
data do not include establishments having an 
annual production of less then $5,000. 

As of January, 1935„ 



Size of Establishment 

By Value of Prod uct. - Over 60 per cent of the dollar volume of the In- 
dustry in 1929 was turned out by the 81 plants having an annual production 
valued at more than $5,000,000. These plants constituted less than 5 per 
cent of all establishments. (See Table III.) 



8881 



TABLE III 

Number of Establishments and Value of Product, Classify 
by Value of Product per Establishment, 1929 



Value of Product 


Establishments 


Value of Product 


per Establishment 




Per Cent 


Amount 


Per Cent 




Number 


of Total 


(Thousands) 


of Total 


All Establishments 


1,802 


100.0 


$2,300,916 


100.0 


$5,000 to $19,999 


264 


14,7 


3,384 


0.2 


20,000 to 49,999 


262 


14.5 


8,552 


0.4 


50,000 to 99,999 


234 


13,0 


16.846 


0.7 


100,000 to 249,999 


322 


17.9 


52,304 


2.3 


250,000 to 449,999 


200 


11.1 


69,657 


3.0 


500,000 to 999,999 


180 


10.0 


131,760 


5,7 


1,000,000 to 2,499,999 


171 


9.5 


270,968 


11.8 


2,500,000 to 4,999,999 


88 


4.9 


335,670 


14.6 


5,000,000 and over 


81 


4.5 


1,411,776 


61.4 



Source: Census of Manufactures, 1929, "Electrical Machinery, Apparatus, and 
Supplies." Census data do not cover establishments having an 
annual production of less than $5,000. 

By number of Wage Earners . - On the basis of wage earners, 3 per cent 
of the establishments — those employing over 1,000 wage earners — accounted 
for 57 per cent of the total number employed in 1929. (See Table IV.) 

TABES IV 



Number of Establishments and Mumber of Uage Earne^o, 

Number of Wage Earners per Establishment, 1929 



Classified 



f 3 t 



Number of 
Wage Earners 
per Establishment 



Establishments 



Number 



Per Cent 
of Total 



Wage Earners 
per Cent 
of Total 



Number 



All Establishments 

No Wage Earners 

1-5 

6-20 

21 - 50 

51 - 100 

101 - 250 

251 - 500 

501 - 1,000 

1,001 - 2,500 

2,501 and more 



1,802 



100.0 



328,722 



100.0 



5 


0.3 





0.0 


418 


23.2 


1,496 


0.5 


486 


27.0 


5,710 


1.7 


267 


14.8 


8,994 


2.8 


184 


10.2 


13,269 


4.1 


224 


12.4 


34,789 


10.6 


109 


6.1 


38 , 834 


11.8 


53 


2.9 


36,928 


11.3 


37 


2.0 


54,945 


16.5 


19 


1.1 


133,757 


40.7 



Source: Census of Manufactures. 1929 , "Electrical Machinery, Apparatus, 
and Supplies." Census data do not include establishments having 
an annual production of less than $5,000. 



8881 



-6- 

Capital Investment 

The capital investment of the Industry has been estimated by the 
National Electrical Manufacturers Association at from $1,000,000,000 to 
$1,250,000,000 in 1929, and from $900,000,000 to $1,150,000,000 in 1933. 
The estimate is based on reports from 125 companies which account for about 
two-thirds of the Industry' s sales and from 75 zo 80 per cent of the total 
number of employees. 

Net Profit or Loss 

The net profit or loss of the Industry is estimated by the National 
Electrical Manufacturers' Association to be as follows: 

1929 $159,072,571 

1932 - 25,987,048 (loss) 

1933 - 13,432,046 (loss) 

The estimate is based on reports of 125 companies who reported sales 
amounting to $425,963,000 for 1933, and 140,000 employees, in September, 
1933. 

Value of Production by Principal Product Groups 

The value of production of the Industry as reported by the Census of 
Manufactures is given by principal product groups in Table V. These figure? 
show the decline of business in all sub-divisions of the Industry from 1929 
through 1933, The most marked decline took place in the products used for 
industrial equipment. 



8881 



-7- 

TABLE V 

Total Value of Product by Principal Product Groups, 
(>.n thousands) 



Product Group 


1929 




1931 




1933 


Total 


$2,334,246 




$1.-172,393 




$015,307 


Conduit s 


53,270 




32,835 




18,323 


Household Apparatus and 












Appliances 


84 5 485 




55,578 




35,723 


Insulated Tare and Cable 


312,592 




120,739 




81,225 


Lamps, Incandescent Filament 


85,320 




70,502 




49,274 


Motors 


194,846 




95,003 




55,703 


Radio Apparatus and Supplies 


411,637 




184,750 




109,144 


Switch Boards, Circuit 












Breakers, and Switches 


81,201 




44,832 




14,499 


Transformers and Circuit - 












Limiting Reactors 


77,825 




42,742 




14,853 


Generators 


80,932 




34,438 




IS, 298 


Wiring Devices 





a/ 





sJ 


16,465 


Control Apparatus 





a/ 





a/ 


14,853 


All Others 


949,138 




490,923 




208,931 


Source: Census of Manufacture. 


s; see source to Table II, 


above, for furthe: 



details regarding Census data. 

a/ Included in "All Others." 

Estimated Total Sales, by Principal Types of Product 

In Table VI are shown estimates of sales of all products under the Code 
as prepared by the Code Authority from Census data. Although the items are 
grouped differently, this table indicates the same general decline shown in 
Table V. Domestic sales, as shown in Table VII for the years 1933 and 1934, 
increased from $598,000,000 in the former year to $706,000,000 in 1934, 



8881 



-8- 
TABLE VI 

Estimated Total Sales "by Principal Type of Product 
(in thousands) 



Type 




1929 


1931 


1933 


Total 




$2,401,000 


$1,235,000 


$650,000 


Refrigeration 




136,000 


128,000 


89,000 


Radio 




412,000 


163,000 


100,000 


Appliances 




66,000 


43,000 


25,000a/ 


Incandescent Lamps 


84,000 


68,000 


48,C0:/r/ 


Insulated Wire 


and Cable 


313,000 


120,000 


61,000a/ 


Motors and Generators 


265,000 


125,000 


66,000 


Telephone and 


Telegraph 


166,000 


113,000 


22,000 


Electrical Supply 


314,000 


177,000 


77,000a/ 


All Other 




645,000 


298,000 


162,000 



Source: Code Authority for the Electrical Manufacturing Industry. 

a/ It will he seen that this figure for total sales is surlier 

than the figure reported by the Code Authority (Table VII) for 
domestic sales. 

TABLE VII 

Estimated Total Domestic Sales, by Principal 

Type of Product, 1933 and 1934 

(in thousands) 



Type 


1933 


1934 


Total 


$598,408 


$765,538 


Refrigeration 


75,544 


107,058 


Radio 


87,245 


102,025 


Appliances 


29,529 


45,290 


Incandescent Lamps 


53,916 


59,534 


Insulated Wire and Cable 


63,000 


84,341 


Motors and Generators 


61,624 


73,463 


Telephone and Telegraph 


3,261 


5,089 


Electrical Supply 


81,380 


109,089 


All Other 


142,909 


178,849 



Source: Code Authority for the Electrical Manufacturing 
Industry. 



8881 



-9- 

Cha .tor II 

LABOR AID MATERIALS 

Total Annual Emjloymen t 

A decline of more thin 50 'jer cent was registered between 1929 and 
1933 in both total employment and in number of wage earners, according to 
estimates "by the Code Authority. Abo at one-fourth of this loss was re- 
covered l^y 1934. Table VIII presents data for the years 1929, 1931, 1933, 
and 1934. 

TABLE VIII 

Estimated Total Annual Number of All Employees, 
and of Wage Earners 



Year All Employees Wage Earners 

1929 410,000 338,000 

1931 265,000 215,000 

1933 200,000 155,000 

1934 250,000 200,000 



Source: Code Authority for the Electrical 
Manufacturing Industry. 



Number of TTage Earners by Principal State s 

The number of wage earners in the leading states in the years 1929, 
1931, and 1933 is shoi.Ti in Table IX. The same concentration in the 
Northeastern States is indicated as in Tables II, above, and XIX, below. 
In 1933, over 80 per cent of all wage earners were reported in the eight 
states listed. Pennsylvania had the highest number, with Ohio, New York 
and Illinois following in the order mentioned. 

TAELE IX 
Annual Average Number of Wage Earners, 

b y Princ ipal States 

State 1929 1931 1933 





IT. S. Total 




328,722 




216,596 


163,201 






Connecticut 




15,225 




10,927 


9,627 






Illinois 




57,347 




34, 647 


19,174 






Indiana 




20,757 




13,907 


12,072 


_/ 




Massachusetts 




28 , 844 




20,055 


14,285 






New Jersey 




42,193 




28,455 


12,514 


a/ 




New York 




43,979 




27,844 


19,272 






Ohio 




36,267 




22,972 


21,243 






Pennsylvania 




47,373 




32,814 


24,312 






All Others 




36,737 




24,975 


30 , 402 


_/ 


Source : 


Census cf Manufactures; 


see source 


to Table II, 


above, for further 




details regarding 


Census 


data. 










a/ 


Data on ''Radios and Phonographs" not 


included. 






_/ 


Includes the wage 


earners in "Radios 


and Phonograwhs" omitted for 


8881 


Indiana and New Jersey. 













Data showing the number of "processing employees, " i. ei, those 
engaged in direct labor, who constitute about 70 per cent of all employees 
in the Industry, are presented in Table X for leading states in 1934 end 
1935. Although the states do not rank in quite the sane order as that 
shown for all enployees in the year 1933, the pro rortion accounted for by 
the eight leading states is about the saif.c,, 

TABLE X 

Processing Employees, by Principal States, 
1934 and 1935 



State 


1934 


1355 a/ 


U. S. Total 


172,114 


175,177 


Connecticut 


8,506 


8,657 


Illinois 


18,157 


18,480 


Indiana 


8,599 


8,752 


Massachusetts 


13,369 


13,607 


Hew Jersey 


20,451 


20,815 


Hew York 


21,250 


21,628 


Ohio 


26,012 


26,475 


Pennsylvania 


25,258 


25,703 


All Others 


30,512 


31,055 



Source: Cod.e Authority for the Electrical L'anufacturing Industry 
a/ As of January, 1935. 

Total Annual Payrolls 

Code Authority estimates of total payrolls of all employees and of 
wage earners for 1929-1934 are presented in Table XI. In both cases the 
drop from 1929 to 1933 was more* than two-thirds of the 1929 total. The 
increase reported in 1934 was slightly more marked for wage earners than 
for all emoloyees. 

TABLE XI 
Estimated Total Annual Payrolls of All Employees, 
and of Wage Earners 
(in thousands) 



Year 



All Employees 



Wage Earners 



1929 
1931 
1933 
1934 



$620,000 
320,000 
183,000 
255,000 



$471,000 
242,000 
137,000 
195,000 



Source: Code Author it; 
Industry. 



for Electrical i.ianuf acturing 



8881 



-11- 

Anmial Wages by Principal State s 

Total traces r? E id are shown for the eight leading states for 1929, 
1931, and 1933 in Table XII. The relative positions of the states changed 
during the depression: Illinois and Pennsylvania ranked first and second, 
respectively, in 1929 and 1931. but by 19Z3 Pennsylvania was first and 
Illinois second. 











TABLE XII 










Total Annual 


Wages, by Principal States 














[In thousands) 








State 






1929 


1931 


1933 




U. S. Total 






$456,378 


$23-3,634 


$144,948 




Connecticut 






17,732 


10,963 


7,427 




Illinois 








95,441 


41,782 


18,805 




Indiana 








25,783 


14,474 


11,090 


a/ 


Massachusetts 






41,012 


22,752 


13,263 




Ken Jersejr 






54, 639 


32,735 


11,423 


a/ 


New York 








63,718 


31,155 


16,994 




Ohio 








46,170 


24,564 


18,555 




Pennsylvania 






67,734 


36,210 


21,032 




All Others 






44, 149 


24,999 


26,359 


5/ 


Source: 


Census c 


f 1 


lanufactures; see 


•source to Table II, 
regarding Census data. 






above, for 


further details 




a/ 


Data on 


"Radi 


os and Phonographs" not included. 




5/ 


Includes t 


le 


wages in "Radios and Phonographs" 






omitted 


fo 


r Indiana and New 


Jersey. 






Hourly Wages 

















Hourly rates in the Industry were slightly higher in 1934 than in 
1929, according to two separate sources — the National Industrial Confer- 
ence Board and the Code Authority. Very little change is indicated in 
hourly rates during the depression; the large drop in payrolls is apparently 
to be accoimted for rather by the reduction in employment and the prevalence 
of part-tine work. Hourly wages, as reported by the two sources, are 
shown below; 

TABLE XIII 
Average Hourly Wages (Cents per hour) 



As Re-oorted by 



Year National Industrial Code 

Confe rence Board Authority 

1929 62~75 56.0 

1951 63.2 57.0 

1933 57.1 51.0 

1934 64.4 57.0 

Source: National Industrial Conference Board, Service Letter ; and Code 
Authority for Electrical Manufacturing Industry. 

8881 



Weekly Hours 

As sho\m in Table XIV, average hours worked per week declined nearly 
one-third from 1929 to 1934. 

TABLE XIV 
Average Hours Worked per Week 



Average Hours 
Year P 9r Week 

1929 47 ° 5 

1931 38.0 

1933 33.5 

1934 32.4 



Source: Code Authority for the Electrical llanufacturing 
Industry. 



Weekly E^ 



Although average weekly earnings declined from $26.80 in 1929 to 
$18.75 in 1934, the 1934 average was slightly greater than in 1933, as 
indicated in the following table. 





TABLE 
Average Wee' 


XV 
:ly Earnings 


Year 








Weekly Earnings 


1929 
1931 
1933 
1934 








$25.80 
21.50 
17.25 

18.75 



Source: Code Authority for the Electrical 
Manufacturing Industry. 

Employment, Hours, and Earnings Under the Code 

In addition to the annual data already given, monthly labor data for _ 

1933 and 1934 are presented in Table XVI, from which to judge the effect ^oi 
the Code in this field. These data, which were compiled by the Bureau of 
Labor Statistics in cooperation with the USA, Research and Planning : vision, 
pertain to the Industry as defined by the Code. The average employment for 

1934 and total man-hours are shown to have increased 26 per cent over 1933, 
while payrolls increased 39 oer cent. During 1934 there was a slight upward 
change^ in the average hours worked per week, compared with the decrease siiown 
by the Code Authority figures in Table XIV, above. Average hourly wages in- 
creased from 55.1 to 58.6 cents, which is a somewhat smaller increase than 
that reported by the national Industrial Conference Board and the Code Author- 
ity in Table XIII, above. The increase in average weekly earnings of 60 cents 
was considerably less than that reported by the Code Authority, but the fig- 
ures for both 1933 and 1934 were higher than the Code Authority's. To tOu t 
extent these changes are directly due to the Code rather than other factors 
affecting the business situation in the latter part of 1933, and in 1934, can- 
not, of course, be stated. 

8881 



-13- 
TABL2 XVI 
Factory Employment, Payrolls, Hours and Wages, 1933-193' 





Indexes, 1933* > 


00 


Average 

Hours 
Worked 

Per Week 




~ 


res 


Month b/ 


Employ- 
ment c/ 


Pay- 
rolls c/ 


Man- 
Hours d/ 


Average 
e/Hourly e/ 


Average 
Weekly c/ 


1933 
















January 


81.7 


77.0 


71.3 


29.7 


58.90* 




$19.20 


February 


82.0 


78.9 


76.8 


31.7 


55 ; 4' 




19.60 


March 


80.7 


75.6 


71.6 


30.0 


56.5 




18.72 


April 


82.0 


73.0 


79.6 


32.8 


54.0 




18.97 


May 


86.8 


84.8 


91.4 


55.6 


52.. 6 




19.48 


June 


91.9 


92.2 


102,2 


37.6 


50.8 




19.93 


July 


96.7 


95.9 


105.0 


36.7 


51.4 




18.68 


August 


105.7 


107.8 


111.2 


35.6 


54.8 




19.27 


September 


116.5 


117.2 


114.7 


33.3 


56.3 




19.85 


October 


126.4 


132,1 


129.6 


34.7 


57.3 




20.77 


November 


128.0 


134.6 


128.6 


34.0 


56.8 




20.66 


December 


121.6 


125.9 


117.6 


32.7 


56.3 




19.18 


Average 


100.0 


100.0 


100.0 


33.7 


55.1 




19.53 


1934 
















January 


113.9 


112.0 


103.1 


32.1 


56.8 




18.34 


February 


114.1 


115.4 


110.6 


32.8 


56.9 




18.60 


March 


118.6 


123.2 


117.5 


33.5 


56.8 




19.15 


April 


123.3 


133.5 


123.6 


33.9 


57.7 




19.90 


May 


126.6 


142.4 


129.5 


34.6 


58.7 




20.69 


June 


129.2 


148.1 


133,0 


34.8 


59.5 




20.94 


July 


128.9 


144.2 


128.4 


33.7 


59.7 




20.37 


August 


130.3 


147.8 


132.2 


34.3 


59.8 




20.68 


September 


131.8 


145.3 


129.0 


33.1 


59.0 




2C05 


October 


131.6 


151.3 


135.8 


34.9 


59.2 




20.90 


November 


130.3 


148.1 


132.1 


34.3 


59.7 




20.60 


December 


129.2 


152.6 


133.7 


35.0 


59.8 




21.37 


Average 


125.7 


138.7 


126.1 


33.9 


58.6 




20.13 


S o ur ce : Unpubl i 


shed data 


secured by 


the Bureau of Labor Statistics 


in coopera 


tion wi 


th the Division of Research and Planning, NRA. 






a/ Reporting establi 


shments considered to be almo 


3t completely covered 


by the 


Electrical 


Manufacturing Code. 










b/ Figures 


reported 


were for the payroll 


period nearest the 15th of the 


month. 
















c/ Based upon a repr 


esentative 


sample covering an 


average 


of 


234 e stab- 


lishments and nearly 98,250 


employees 


in 1933. 


The sample 


was some- 


what larger in 1934. 












d/ Computed: Index 


of employment times 


average hours -.70 rl 


:ed 


per week 


reduced 


to 1933=100. 












e/ Based upon a representative 


sample covering an 


average 


of 


153 estab- 



lishments and nearly 61,000 employees in 1933. The sample was some- 
what larger in 1934. 



8881 



Labor Cost 

The proportion of "hie;: antra; 1 i re of the total value of product 

increased" from 19.6 per cent in V. 29 to 23,6 per cent in 1933. Table XVII 
presents the data as derived from the Census of Manufactures. 

TABLE XVII 

Relation of Labor Cost to Total Value of Product 



Total Value Total Annual 'Japes 

Year of Product Amount Per Cent of 



(thousands) (thousands) Total Value 



1929 $2,334,246 $456,379 19.6 
1931 1,172,393 239,634 20.4 

1933 615,307 144,948 23.6 



Source; Census of Manuf a c ture £ ; see source to Table II, above, for details 
regarding Census data. 

Materials Used 

The Electrical Manufacturing Industry uses practically every known mate- 
rial in the manufacture of its products. The principal materials used are 
copper, iron, steel, paints and other covering materials, porcelain, and 
plastics. 

Cost of Materials 

As shown in Table XVI II the percentage which the cost of materials, in- 
cluding fuel and electrical energy, is of the total value of product declined 
somewhat from 1929 to 1951, and then increased to 1933. 

TABLE XVIII 

Relation of Cost of Materials to Total Value of Product 



Total Value Cost of Material 

Year of Product Amount Per Cent 

(thousands) (thousands) of Total 



1929 $2,334,246 $971,017 41.6 

1931 1,172,393 425,527 36.3 

1933 615,307 270,043 43.9 



Source; Census of Manufactures; see source to Table II, above, for details re- 
garding Census data. 



8381 



-15- 

Chapter III 

PRODUCTION AND DISTRIBUTION 

Value of Production by Principal States 

Table XIX shows that the eight states listed accounted for over 80 
per cent of the total value of production in 193?, although, as shown in 
table II, above, they accounted for only 60 per cent of the total estab- 
lishments in that year. Ohio was the most important state in 1933, although 
up until that time it had been outranked by other states. 

TABLE XIX 

Value of Production, by Principal States 
(In thousands) 

State 1929 1931 1935 

U. S. Total $2,300,917 $1,188,153 $668,257 

Connecticut 86,894 46,579 31,453 

Illinois 435,022 204,644 78,795 

Indiana 133,353 73,725 50,380 a/ 

Massachusetts 184,787 104,326 52,628 

New Jersey 292,785 145,663 61,299 a/ 

New York 280,139 124,081 74,128 

Ohio 264,360 144,191 107,151 

Pennsylvania 347,141 184,688 91,095 

All Others 276,435 150,256 121,328 b/ 



Source: Census of Manufactures ; see source to Table II, above, for 

details regarding Census data. 

a/ 

— ' Does not include -oroduction of "Radios and Phonograohs." 

b/ Includes "Radios and Phonographs" omitted for Indiana and 
New Jersey. 

Distribution of Manufacttirers 1 Sales 

The distribution of sales in the Industry for the year 1929 as reported 
by manufacturing plants to the Bureau of the Census is presented in Table 
XX. Sales to wholesale dealers and to industrial consumers constituted 70 
per cent of the total. 



8881 



-16- 
TABLE XX 
Distribution of Sales of Manufacturing Plants, 1929 



Sel 1 in Per Cent Number of Plants 

Value of Sales Selling 

(F.Q.B. factory) Total Exclusively 

as indicated 



Total 



$2,230,361,000 100.0 1,774^ 



Sales to manufacturers' 

ovm wholesale branches 464,148,000 20.8 216 73 

Sales to manufacturers' 

own retail branches 67,762,000 3.0 49 

Sales to dealers: 

Uholesalers 700,335,000 31.4 963 370 

Retailers 131,033,000 5.9 517 94 

Sales to consumers: 

Industrial (manufacturers, 
power companies, rail- 
roads, etc.) 359,957,000 38.6 857 381 

Household 7,128,000 0.3 a 2 46 

Source: Bureau of the Census, Distribution of Sales of Manufacturing Plants , 
1929. 

a/ The total number of manufacturing plants engaged primarily in making 
electrical machinery end apparatus is 1,802. Of these, 20 do only 
contract work, and 6 transfer their entire outout to other plants 
of the same company. Inasmuch as some of the other 1,776 plants 
sell to more than one type of customer, this figure is less than 
the total of the figures shown below it. 

Wholesale Sales 

The number of "electrical" wholesale establishments and the value of net 
sales made by them in each of ten leading states is given in Table XXI. 
These figures indicate that more than one-fourth of these establishments were 
located in the states shown in 1929 and in 1933, and that approximately the 
same -iroportion of total net sales were made in these states. New York is, 
of course, by far the most important state, both as to number of establishments 
and net sales, in each of the years shown. 

In using these data it must be borne in mind that they do not cover all 
sales of electrical goods hut only those reported by the Census in the group 
labeled "electrical" wholesale establishments, and that not all of these sales 
as reported are necessarily confined to electrical goods. 



8881 



-17- 
TABLE XXI 



Number of "Electrical" Wholesale Establishments and Value 
of Net Sales Reported by them, by Principal States, 1S29 and 1933 SJ 



State 



Numb p l- of E ^tFDli r-nnents 
1929 1933 



Net Sales (OOP's) 



1929 



U. S. Total 

California 

Illinois 

Massachusetts 

Michigan 

Missouri 

New York 

Ohio 

Pennsylvania 

Texas 

Washington 



3,870 

392 
319 
186 
169 
174 
711 
264 
380 
106 
98 



,232 

334 
269 
176 
155 
123 
565 
251 
279 



52,435,149 


$705,411 


175,245 


47,533 


294,329 


62,244 


109.122 


41,579 


111,877 


40,538 


93,763 


24,°94 


556,953 


132,934 


211,813 


60,312 


221 , 681 


86,980 


57,953 


14,855 


36,752 


7,037 



All Others 



1,071 



565,631 



186,405 



Source: Census of Wholesale Distribution. 1929 . and Censi-.s of American 
Business, 1953. Wholpsale Distribution , U. S. Summary and State 
reoorts. The 1933 data do not include establishments having annual 
sales of less than $1,000. 



sJ 



"Electrical" wholesale establishments are here defined to include 
those the major -oart of whose sales are electrical goods and appli- 
ances, electrical equipment and supplies, radios and radio equipment, 
and 'electric refrigerators. 



Exports 



According to Table XXII, exports declined in 1933 to about one-third 
their 1929 value, but by 1934 had risen to about one-half the 1929 level. 

TABLE XXII 
Value of Exports 



Year 



Amount 



1929 

1931 
1933 
1934 



$130,062,818 
85,080,455 
43,580,279 
66,524,800 



Bureau of Foreign and Domestic Commerce, 
Monthly Summary of Foreign Commerce . 



RRR1 



•18. 



Advertising Media 



The nature of the advertising media varies with the different products 
of the industry. Many domestic appliances, for example, are advertised 
extensively "by the use of the radio, national magazines, sign "boards and 
newspapers. Other products are advertised only in trade journals or technical 
magazines. Table XXIII shows the dollar-volume of radio and magazine adver- 
tising used in the r>ast few years "by the radio manufacturers. 

TABLE XXIII 

Advertising Expenditures of Radio Manufacturers for Radio 
Broadcasting and Magazine Advertisements §/ 

Year Radio Broadcasting Magazine Advertisements 

1929 $3,732,000 $5,618,000 

1931 910,000 2,754,000 

1933 566, uCO 1,296,000 

1934 556,000 1,531,000 

Source: Prepared from data published in Bureau of Foreign and Domestic Com- 
merce, Survey of Current Business , as compiled "by Denney Publishing 
Company, Inc. 

a/ Radio data are for the National Broadcasting Oomoany and the Colum- 
bia Broadcasting System and include only national advertising; mag- 
azine data represent the cost of advertising of radio manufacturers 
in all classes of national magazines. 



8881 



-19- 

Chapter IV 
HtADE PRACTICES 



Tlie various unfair trade practices of certain members of the Industry 
have been outlined by Mr, A. L. Kress, formerly Code Administration Direc- 
tor of the national Electrical Manufacturers' Association. I3elow are 
excerpts from a letter to the HRA, dated June 4, 1^55: 

"It is believed that the following unfair tra.de practices 
have, and in some cases still do avail in the industry. It is 
of course impossible to appraise their extent or magnitude. 

A - Selling Below Cost: 

"This being one of the provisions incorporated in the 
basic code, it is reasonable to assume that selling below cost 
must have been widely prevalent in the industry prior to the 
approval of the code. This industry was probably no different 
from other industries. That was the impression when the whole 
question of selling below cost became such a debated topic in 
any discussions of the elimination of unfair trade "oractices. 

B - Terms and Conditions of Sale: 

"The following -oractices having to do with terms and con- 
ditions of sale all apparently have existed in some degree as 
evidenced by the frequently erroressed desire to incorporate 
provisions in supplemental codes dealing with them, 

(1) Giving of excessive cash discounts. 

(2) The granting of excessive preferred terms of payment 
which were uneconomic, inconsistent with prevailing 
commercial terms, and which were obviously intended 
as a method of reducing the price itself. 

(3) The granting of excessive trade discounts not war- 
ranted by the cost of doing business and the services 
rendered in return. 

(4) The giving of excessive trade-in allowances on 
certain products, not warranted ~oy the scrap or re- 
sale value of the product traded in, and which were 
obviously intended as a method of price cutting. 

(5) The practice of making lump sum bids on certain 
products, where the sub-total was less than the 
total for the individual items, where such reduc- 
tions were not warranted by the quantity purchased, 
and again where the intent was to offer an unbalanced 
bid or to cut trices. 



8881 



-20- 

(6) The offer or giving of cash allowances or contri- 
butions towards the payment of advertising of cus- 
tomers, where such allowances or contributions were 
not warranted by the value received and which, in 
effect, served to improperly reduce prices. 

C - Selling Methods: 

"The following practices having to do with selling all a 
apparently have existed in some degree as evidenced by the fre- 
quently expressed desire to incorporate provisions in supple- 
mental codes dealing with them - 

(1) The splitting of commissions by salesmen, particular- 
ly in the case of sales to municipalities. 

(2) The acceptance of returned goods under conditions 
not warranted by any legal or moral responsibility 
incurred by the manufacturer. 

(3) The giving of secret rebates. 

(4) The policy of individual or multiple prices which 
in effect constitute a discrimination against cus- 
tomers of the same class through the granting of 
special concessions. Such special concessions were 
of course usually known only to the parties involved. 

(5) The use of consignment methods or ledger balances, 
where such methods were used primarily to exclude 
competitors from certain areas, 

(6) Improperly influencing the actions of employees or 
representatives of customers or potential customers 
through gifts or otherwise. 

(7) The use of advertising which misled or was designed 
to mislead potential customers. 

(8) The acceptance of blanket or requirement orders at 
prices not warranted ~by the size of the individual 
shipments made. 

(9) Substitution of material in the case of competitive 
bids not equal to that required in the specif ications 
themselves, which constituted misrepresentation. 

(10) The improper rental of equipment on terms which in 
effect simply evaded the price at which such equip- 
ment should have been sold. 

(11) The giving of free service or the placing of equip- 
ment on trial or the unwarranted furnishing of samples 
all done with the intent of indirectly reducing the 
price at which such equipment should have been sold, 

8331 



-21- 

(12) The making of lor-; term contracts which did not pro- 
vide for price adjustment in order to reflect changes 
in cost. 

(13) The guaranteeing against price declines without a 
corresponding provision guaranteeing to the manu- 
facturer an adjustment in case of price increase, 

(14) The use of an unsound warranty provision, 
D - Relations with Competitors: 

(1) The defamation of competitors and products, 

(2) The malting of derogatory statements rith regard 
to competitors and their policies. 

E - Policy with respect to Products: 

(1) The marketing of products which fail to conform 
with recognized standards of safety, 

(2) The marketing of products which fail to conform 
to accepted ratings and performance requirements, 

(3) The misbranding of products with intent to deceive 
customers or potential customers, 

(4) The misrepresentation of products with regard to 
the quality, characteristics or performance, 

(5) The imitation of competitors' trade marks for the 
purpose of misleading customers or potential 
customers, 

(6) The selling of firsts as seconds, or seconds as 
firsts, with the intent either to cut prices or 
mislead customers, 

"The above lists should, he understood as neither exhaustive 
nor as implying that all these practices have existed in all bran- 
ches of the industry at the same time," 



3831 



Che >ter V 
THE INDUSTRY - GENERAL INFORMATION 

Trade Associations 

The National Electrical Manufacturer s ! Association is the dominant 
trade association in this Industry. It was forned in 1926 by the merger of 
three then existing associations; nan Ly, El ctrical Manufacturers' Council, 
formed in 1905; Electric Power Club, formed in 1908; and Associated Manufactur- 
ers of Electrical Supplies, forned in 1915. Its membership includ.es over 500 
companies, representing practically the entire field of electrical manufacture. 
It is estimated by the Association that its members produce 85 per cent of the 
production of the entire Industry. The Association was designated in the Code 
as the "agency for administering, supervising and promoting the performance of 
the provisions of the Code by the members of the Electrical Manufacturing In- 
dustry." In addition to its former Code activities, the staff of the Associa- 
tion renders the membership many other services. 

There are a few smaller trade associations that cover only certain product 
groups, suchas Radio Manufacturers' Association, Electric Porcelain Manufactur- 
ers 1 Association, national Lamp and Shade Manufacturers' Association, and In- 
candescent Lamp Manufacturers' Association. 

Labor Organization 

Mr. Avery Laiserson, of the NRA Labor Advisory Eoard Staff, has :re oared 
the following statement on labor organization in the Electrical Manufacturing 
Indus try; 

"The recognized trade unions claiming jurisdiction in this Industry 
are: the electric workers, the machinists, the molders, pattern makers and 
metal polishers. The federal unions have experienced a considerable 3 wtl 
in numbers under the ISA, particularly in the radio division of the In- 
dustry. The latter organizations are local unions attached directly to th 
American Federation of Labor, rather than local chapters of a national 
craft organization. Federal unions are not restricted to members of one 
craft or closely allied crafts in an amalgamation, but cover the entire 
plant from top to bottom. As yet, they have not begun to spread over en- 
tire industries, but confine themselves to one plant of one company. 
Liany people in the labor movement believe that a combination of t 
unions into a national organization on a vertical basis is imminent. 

"It is exceedingly difficult to quote any exact figures of union 
membership. Representation was claimed at the first public hearing on th< 
Electrical Code for something less than 10,000 workers in the five crafts 
mentioned above — i.e., that was the number in the unions who had jobs 
and were -under union agreements. Of course, that was not the only basis 
of representation. With the growth of -onion membership under the Act and 
the success of organizing several local federal unions, a much great r 
number of workers may be said to be directly affiliated with the 
Federation of Labor. This do«s not include those who might pr 
F. of L. to represent them rather than the company unions nliich have sps :n 
u; > in the industry " 



8381 



Imports 

There is some competition from imported electrical goods, especially in 
the class of products sold in th li lit i '-price and chain stores. 

Several months ago, the Code Authority was considering petitioning the 
President to use his powers under the National Industrial Recovery Act to Un- 
it the quantities of certain electrical . oods which it was felt were being i - 
ported to such an extent that domestic production was suffering. The Code 
Authority felt that there was danger that the increasing ratio to domestic 
production might "render ineffective or seriously (to) endanger the 
maintenance 11 of the Code. No detailed data are available on this question. 

Effect of the Code 

Official expressions of opinion as to the effect of the Code were 
tainable. However, the unofficial consensus seems to be that the Co .e had a 
stabilizing effect on prices in general and that with a few exceptions, 
"destructive" price catting had "been graatly reduced. The tern "destructive 
price cutting" in this instance is considered to nean price cutting that de- 
moralizes the Industry and results in lowering wages and forcing operation foi 
long periods without -profit. The exceptions, in every case nentioned, in 
volved products which could "be produced with very little canital investment 
and which in nost cases were sold in linited-'orice or chain stores and which 
vere, therefore, subject to extreme -pressure fron the "buyers of these organi- 
zations. 



\