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NATIONAL  RECOVERY  ADMINISTRATION 

■ 


DIVISION   OF   REVIEW 


EVIDENCE       STUDY 
NO.    37 

OF 


THE  SILK  TEXTILE  INDUSTRY 


Prepared  by 
W.  C.  HENDERSON 


September,  1935 


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


i 


THE  EVIDENCE  STUDY  SERIES 

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

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

The  full  list  of  the  Evidence  Studies  is  as  follows: 


1.  Automobile  Manufacturing  Ind.  23. 

2.  .Boot  and  Shoe  Mfg.  Ind.  24. 

3.  Bottled  Soft  Drink  Ind.  25. 

4.  Builders'  Supplies  Ind.  26. 

5.  Chemical  Mfg.  Ind.  27. 
G.  Cigar  Mfg.  Industry  28. 

7.  Construction  Industry  29. 

8.  Cotton  Garment  Industry  30. 

9.  Press  Mfg.  Ind.  31. 

10.  Electrical  Contracting  Ind.  32. 

11.  Electrical  Mfg.  Ind.  33. 

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

13.  Fishery  Industry  35. 

14.  Furniture  Mfg.  Ind.  36. 

15.  General  Contractors  Ind.  37. 

16.  Graphic  Arts  Ind.  38. 

17.  Gray  Iron  Foundry  Ind.  39. 

18.  Hosiery  Ind.  40. 

19.  Infant's  &  Children's  Wear  Ind.   41. 

20.  Iron  and  Steel  Ind.  42. 

21.  Leather  43. 

22.  I/umber  &  Timber  prod.  Ind. 


Mason  Contractors  Industry 

Men's  Clothing  Industry 

Motion  picture  Industry 

Motor  Bus  Mfg.  Industry  (Propped) 

needlework  Ind.  of  Puerto  Rico 

Fainting  &  Paperhanging  &   Decorating 

photo  Engraving  Industry 

plumbing  Contracting  Industry 

Retail  Food  (See  Ho.  42) 

Retail  Lumber  Industry 

Retail  Solid  Fuel  (propped) 

Retail  Trade  Industry 

Rubber  Mfg.  Ind. 

Rubber  Tire  Mfg.  Ind. 

Silk  Textile  Ind. 

Structural  Clay  products  Ind. 

Throw i ng  I  ndus  try 

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 
i7.  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  31dg.  &  Repairing  Ind. 

53.  Wholesaling  or  Distributing  Trade 


L.  C.  Marshall 
Director,  Division  of  Review 


CONTENTS 

Page 

Foreword 1 

CHAPTER   I  -  THE  NATURE  OF  THE  INDUSTRY  AND 

HISTORICAL  BACKGROUND 2 

Definitions  of  the  Industry  

History  of  the  Industry 2 

Operations  of  the  Industry 3 

Imoortation  of  the  Raw  Silk 3 

Irepar,'.-.tion  of  the  Yarn 3 

leaving  and  finishing  the 

Cloth 3 

Number  of  Establishments 4 

Size  of  Establishments 4 

Number  of  Establishments  by  States 5 

Mills  Operating  in  More  than 

One  State 6 

Caotial  Investment  and  Financial  Condition.  .  .  . 

Failures 

Volume  and  Value  of  Troduction.  ....  

Estimated  Total  froductive  Capacity  

Estimated  Unused  Iroductive 

Capacity 10 

Comr.etition  from  Other  Industries  ........  10 

Troductf  Used  by  Other  Industries  H 


CHAFTER  II  -  LABOR 1 


o 


Total  Number  of  Employees 12 

Number  of  Emoloyees  by  States ■L- 

Tctal  Annaul  Wages 12 

Annual  Wages  by  States 1^ 

Percentage  Labor  Cost  is  of 

Total  Value 13 

Average  Hourly  and  Weekly  Wages, 

and  Hours  Worked " 

Effect  of  the  Code  on  Wages  and  Hours 15 

Number  of  Weeks  Worked 1? 

Child  Labor i3 


8647 


CONTENTS  (Cont'd) 

lage 

CHAPTER  III  -  MATERIALS  -  RAJ  AND  SEMI-PROCESSED 20 

Total  Cost  of  Raw  Materials 20 

Per  cent  Cost  of  Materials  is  of 

Total  Value 20 

Principal  Materials  Used.  ....  23 

Exnenditures  for  Principal  Raw 

Materials . 23 

Source  of  Saw  Materials 24 

Machinery  and  "Equinraarrt 24 

CHAPTER  IV  -  PRODUCTION  AND  DISTRIBUTION 25 

Value  of  Production  in  Principal 

States " 25 

Shift  in  Centers  of  Production 25 

Exports 25 

Advertising 28 

Comparison  of  Production  and  Retail 

Sales  by  States 28 

CHAPTER   V  -  TRADE  PRACTICES 31 

Unfair  Trade  Practices  Prevalent 

Before  Code 31 

Methods  of  Unfair  Competition  Now 

Prevalent 32 

Effect  of  Price:'  of  Individual 
Members  on  the  National  Price 
Structure •   32 

CHAPTER  VI   -  GENERAL  INFORMATION 33 

Manufacturers'  Organizations 33 

National  Federation  of 

Textiles,  Inc ,   33 

Broad  Silk  Manufacturers  of 

Faterson,  N.  J 33 

Master  Ueavers  Institute  °3 

Blackstone  Valley  Manufacturers 

Association,  Providence,  R.  1 3,i 

-  -. ..    .     _  Silk  Manufacturers  of 

Allentown,  Pa 33 

Relationship  Between  Labor  and 

Management 34 

List  of  Ejrperts 34 

~o0o- 


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-li— 


TABIDS 


Page 


TABLE     V  - 


TABLE     I  -  Fuucer  01'  Establishments  in  the 
Silk  Industry  a  3  a   Whole,  l>y 
Frincipal  States.  ....  

TABLE    II  -  Eumber  of  Looms  Installed,  by 

Principal  States,  1934 

TABLE   III  -  dumber  of  Sill"  and  Rayon  Companies 
Having  Mills  in  More  than  One 
State,  Classified  by   Number  of 
Stages  in  Which  "hey  Operate, 
1930 ". 

TABLE    IV  -  Capital  Investment  of  1C7  Silk 

Weaving  and  Throwing  Companies, 
1933  and  the  First  Si::  Months  of 

".  or?  a 

L30*t, 

Total  Net  Income  Before  Interest 
and  ITet  Income  Transferred  to 
Surplus  of  107  Silk  Weaving  and 
Throwing  Companies,  1933  and 
First  Si?:  Months  of  1934 

TABLE    71  -  Bate  of  Return  on  Capital  Stock 

Equity  in  Specified  Divisions  of 
the  Textile  Industries,  1933  and 
1934 

TABLE   VII  -  Value  and  Volume  of  Production  of 

Broad  Goods,  and  Value  of  Ribbons 
Produced 

TABLE  VIII  -  Activity  of  Broad  Looms  Owned  by 

Stock— Carrying  Mills  and  Commission 
Weavers,  1929-1934 

Average  Number  of  Wage  Earners  in 
the  Silk  Industry  as  a  Whole,  "by 
Principal  States 

Annual  Wages  in  the  Silk  Industry 

as  a  Whole,  by  Principal  States  ...... 


TA33 


TABLE     X  - 


13 


14 


8647 


-in- 


TABLES  (Cont'd) 

Page_ 

TABLE    XI  -  Average  Hourly  and  Weekly  Wages 
and  Average  Hours  Worked  Per 
Week  in  the  Silk  Industry  as 
a  Whole 14 

TABLE   XII  -  Employment,  Payrolls,  Hours  and 
Wages  in  the  Industry  as  De- 
fined "by  the  Code,  1933-1934 16 

TABLE  XIII  -  Average  Hours  and  Earnings  "by 
States  in  the  Industry  as  a 
Whole,  1931  and  1934 17 

TABLE   XIV  -  Hourly  Earnings  in  the  Silk  and 

Rayon  Industry,  "by  Sex  and  Region, 

August,  1933 18 

TABLE    XV  -  Hourly  Earnings  in  the  Silk  and 

Rayon  Industry,  "by  Sex  and  Region, 

August,  1934 19 

TABLE  XVI  -  Percentage  Labor  and  Raw  Material 
Costs  Are  of  Total  Value  in  the 
Silk  Industry  as  a  Whole 2C 

TABLE  XVII  -  Quantity  and  Cost  of  Principal 

Materials  Consumed  "by  the  Silk 

Industry  as  a  Whole,  1929  and 

1931 23 

TABLE  XVIII  -  Value  of  Products  in  the  Silk 

Industry  as  a  Whole,  "by  Prin- 
cipal States 25 

TABLE   XIX  -  Volume  and  Value  of  Various  Silk 

and  Rayon  Products  Exported 27 

TABLE    XX  -  Volume  and  Value  of  Exports  of 
Broad  G-oods  Made  Wholly  or 
Chiefly  of  Silk,  "by  Country  of 
Destination,  in  1930,  1931,  1933, 
and  1934 28 

TABLE   XXI  -  Value  of  Production  and  Estimated 
Retail  Sales  of  Silk  and  Rayon 
Broad  Goods,  By  States,  1929 30 

-oOo- 


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-IV- 


CHARTS 


Page 

CHART    I  -  TEXTILE  FIBER  PRICES  IN  THE 

UNITED  STATES 21 

CHART   II  -  TEXTILE  FIBER  COITSULIPTION  IN 

THE  UNITED  STATES 22 


-o0o~ 


8647  -v- 


-1- 

THE  SILK  TEXTILE  INDUSTRY 

Foreword 

The  "basic  statistical  materials  contained  in  this  report  were  taken 
from  publi cations  of  the  Bureau  of  the  Census,  the  Bureau  of  Foreign  and 
Domestic  Commerce,  the  Bureau  of  Labor  Statistics,  and  the  Federal  Trade 
Commission.   Some  additional  statistical  information  has  been  secured  from 
non-governmental  sources.   The  principal  non-governmental  publications 
utilized  were  production  and  Distribution  of  Silk  and  Rayon,  a  study 
published  in  1935  by  The  National  Federation  of  Textiles,  Inc.,  which  is 
the  leading  trade  association  in  the  Industry;  Textile  Qrganon,  a  monthly 
publication  of  Tubize  Chatillon  Corporation,  which  manufactures  rayon; 
and  Current  Insolvency  Trends,  issued  monthly  by  Dun  and  Bradstreet. 

The  most  serious  limitations  of  the  statistical  material  arise  from 
the  fact  that  the  Census  of  Manufactures  data  cover  both  the  preparation 
and  weaving  of  the  yarns,  whereas  under  the  codes  the  throwing  of  silk 
and  rayon  yarns  is  considered  a  separate  industry  and  does  not  come  under 
the  Code  for  the  Silk  Textile  Industry.   Therefore,  all  Census  data  cited 
in  this  report  are,  to  some  extent,  overstatements  since  they  cover  work 
which  would  properly  come  under  the  Code  for  the  Throwing  Industry.   How- 
ever, there  is  no  means  of  accurately  allocating  the  Census  figures  between 
the  Silk  Textile  and  Throwing  Industries.   Whether  the  data  used  apply  to 
the  Silk  Textile  Industry  as  defined  by  the  Code,  or  to  the  Silk  Industry 
as  a  whole  as  defined  by  the  Census  Bureau  has  been  noted  throughout  the 
report. 

A  minor  limitation  arises  from  the  fact  that  Census  figures  do  not 
cover  establishments  whose  annual  value  of  production  was  less  than  $5,000. 
It  is  the  author's  opinion,  however,  that  there  are  very  few  establishments 
of  that  size  in  the  Silk  Textile  Industry. 

Parts  of  Chapter  V  and  all  of  Chapter  VI  are  presented  as  prepared 
by  the  National  Federation  of  Textiles,  Inc. ,  except  for  minor  editorial 
changes. 


8647 


-2- 
CHAP TEE  I 

THE  NATURE  OF  THE  INDUSTRY 
AND  HISTORICAL  BACKGROUND 

Definitions  of  the  Industry 

The  Code  of  Pair  Connetition  for  the  Silk  Textile  Industry  defined  the 
Industry  as  follows: 

"The  term  'industry,'  ...,  means  the  manufacture  of  silk  and/or  rayon 
and/or  acetate  yarn  (or  any  combination  thereof)  woven  fabrics  or  any 
of  the  processes  of  such  manufacturing  except  throwing,  "but  it  shall  not 
not  include  such  manufacturing  of  rayon  and/or  acetate  yarn  fabrics  as 
are  governed  "by  the  provisions  of  the  Cotton  Textile  Code.   The  term 
shall  include  also  the  converting  of  the  woven  fabrics  enumerated  above , 
the  manufacture  of  silk,  rayon,  and/or  acetate  yarn  sewing  threads,  spun 
silk,  woven  labels,  and  shall  include  such  other  related  branches  whether 
engaged  in  merchandising  or  manufacturing  as  may  from  time  to  time  be 
brought  within  the  provisions  of  this  Code." 

The  Census  of  Manufactures  definition  of  the  Silk  and  Rayon  Manufactures 
Industry  is; 

"This  industry  embraces  two  classes  of  establishments;   (1)  Those  en- 
gaged primarily  in  the  manufacture  of  silk  a.nd  rayon  fabrics  and  other 
finished  silk  and  rayon  products,  not  including  knit  fabrics,  hosiery, 
and  other  knit  goods  made  of  silk  and  rayon,  which  are  treated  as  a  part 
of  the  'Knit  Goods'  industry  and  covered  by  a  separate  report;  (2)  those 
engaged  primarily  in  the  Manufacture  of  silk  yarn  (known  technically  as 
organzine,  tram,  and  hard  or  crepe  twist),  spun  silk,  and  rayon  yarn 
(thrown,  twisted,  or  otherwise  changed  into  different  forms  from  those 
in  vhich  purchased)  and  in  the  dressing  of  warps...." 

The  principal  difference  between  these  definitions  is  the  exclusion  of 
the  throwing  of  silk  from  the  Code  definition  of  the  Industry.   As  was  stated 
in  the  Foreword,  that  portion  of  the  Census  data  which  should  be  classified 
under  the  Throwing  Industry  cannot  be  accurately  determined. 

History  of  the  Industry 

Silk  is  one  of  the  oldest  textile  fibres.   Chinese  myths  date  the  culture 
of  silk  back  to  2,640  B.  C. ,  almost  3,200  years  before  its  nature  was  under- 
stood in  Europe.   One  of  the  three  emperors  to  whom  the  Chinese  ascribe  the 
beginning  of  their  ancient  customs  was  Huang-Ti,  who  is  said  to  have  introduc- 
ed the  making  of  garments  of  silk.   He  instructed  his  Empress,  Si-Ling-Chi, 
to  experiment  "ith  wild  silk  worms  which  lived  on  mulberry-tree  leaves,  and 
she  learned  ho-'  to  feed  and  raise  them,  and,  what  is  much  more  important,  how 
to  reel  or  unwind  the  silk  filaments  from  their  cocoons.  1/ 

The  first  silk  mill  in  the  United  States  seems  to  have  been  started  by 
Rodney  and  Horatio  Hanks,  at  Mansfield,  Connecticut,  in  1810.   In  this  mill, 
which  was  12  feet  square,  the  Hankses  made  sewing  silk  and  twist  on  a  machine 
of  their  own  construction,  but  the  venture  never  assumed  commercial  signifi- 
cance because  the  machinery  was  too  crude  to  produce  satisfactory  results. 

1/  Manchester,  H.  H. ,  The  Story  of  Silk  and  Cheney  Silks  (1916)  revised  1924). 
8647 


In  1815  William  H.  Horstnann  built  a  mill  in  Philadelphia  to  make  trimmings 
and  ribbons,  and  he  also  experimented,  with  partial  success,  with  machines 
for  plaiting,  braiding,  and  fringe  cutting.  A  Jacquard  loom  was  imported  by 
him  in  1824.   No  record  has  been  found  of  the  length  of  time  Korstmann  was  in 
business,  but  apparently-  it  was  not  long. 

What  has  been  considered  the  first  really  successful  silk  factory  in  the 
United  States  was  founded  on  January  2,  1838,  by  Balph,  Ward,  and  Frank  Cheney, 
and  S.  H.  Arnold  (Cheney  Brothers)  at  South  Manchester,  Connecticut.   In  1844 
Cheney  Brothers  learned  the  main  points  of  silk  dyeing  from  a  Mr.  Valentine  of 
Northamption,  Massachusetts,  but  the  process  was  necessarily  crude.   In  1847 
the  first  practical  machine  was  patented  for  the  manufacture  of  sewing  silk, 
which  introduced  the  doubling,  twisting  and  winding  equipment. 

Records  of  1843  show  that  the  average  pay  in  the  Cheney  silk  mill,  which 
employed  both  men  and  women,  was  51  cents  a  day.   Wage  rates  apparently  in- 
creased during  the  next  five  years,  for  in  1348  the  wages  of  men  in  the  Cheney 
mill  averaged  $1.14  a  day,  and  those  of  women,  68  cents  a  day.   The  combined 
average  for  all  employees  was  72  cents. 

The  tariff  placed  on  silk  goods  during  the  Civil  War  made  it  possible 
to  develop  the  weaving  of  silk  extensively  in  this  country.   In  1860  the  value 
of  manufactured  silk  was  $6,600,000,  and  by  1921  it  had  increased  to  $533,- 
000,000.  1/ 

Operations  of  the  Industry 

Importation  of  the  Raw  Silk.  -  Silk  is  received  from  Japan  at  the  ports 
of  entry  of  Seattle,  San  Francisco,  and  New  York  City,  by  importin-;  concerns 
which  in  most  instances  are  owned  or  controlled  by  Japanese  firms  —  notably 
Mitsui,  Mitsubishi,  Katakura,  and  C-unze.   The  leading  American  importing  firm 
is  E.  Gerli  and  Company  of  New  York,  which  is  affiliated  with  the  Japanese 
Ashia.  Conroa.ny.   There  are,  however,  some  importations  by  individual  manufac- 
turing Cu:.Tp-;r.ies  whose  requirements  are  sufficiently  large  to  enable  them  to 
have  direct  connections  with  Japanese  filatures  and  to  function  as  importers. 
Notably  among  these  err  Cheney  Brothers  and  Duplan  Silk  Company. 

Preparation  of  the  Yarn.  -  Raw  silk  is  received  in  skeins  packed  in 
bales  weighing  from  130  to  133  pounds.   The  raw  silk  must  first  be  put  through 
certain  preliminary  steyis  in  preparation  for  throwing  it  into  the  size  of  yarn 
desired,  and  after  the  throwing  has  been  completed  the  yarn  is  put  up  in  the 
required  type  of  package,  i.e.,  cones  for  knitting;  tubes,  spools,  cops,  warps, 
or  beams  for  weaving. 

That  portion  of  the  silk  yarn  which  is  knitted  into  hosiery  and  underwear 
usually  passes  through  the  dyeing  and  finishing  processes  in  the  individual 
knitting  mill  and  the  resulting  protract  is  sold  either  by  its  own  sales  de- 
partment or  by  appointed  selling  agents  or  brokers,  to  the  wholesale  and  re- 
tail trades.   The  silk  yarn  which  ii;  ,</ovon  or   otherwise  processed  in  the  Silk 
Textile  Indiistry,  however,  usually  does  not  reach  the  ultimate  consumer  by 
such  direct  methods. 

Weaving  and  Finishing  the  Cloth.  -  The  Silk  Textile  Industry  is  divided 
from  the  production  standpoint  i  ito  two  groups;  —  stock-carrying  mills  and 


1/  Manchester,  H.  H. ,  The  Soory  3f  Silk  and  Cheney  Silks  (1916;  revised  1924). 
8647 


-4- 

comraission  weavers.   The  former  purchase  raw  materials,  weave  their  own  cloth, 
and  sell  the  products  to  the  cutting-un  and  converting  trades  or  directly  to 
the  wholesale  and  retail  trades.   A  stock-carrying  mill  may  or  may  not  finish 
its  own  cloth.   Commission  weavers  are  those  who  weave  goods  on  commission  as 
a  usual  practice,  and  seldom,  if  ever,  purchase  raw  stocks  on  their  own  account 
or  finish  the  clotb  they  weave. 

During  the  last  few  years  commission  weaving  has  assumed  a  new  importance. 
The  falling  prices  of  raw  materials,  particularly  since  1929,  were  accompanied 
"by  large  inventory  losses  and  price  cutting.   In  this  demoralizing  situation 
some  stock- carrying  mills  began  to  employ  commission  weavers,  rather  than 
one rate  their  own  looms,  in  the  expectation  of  cutting  costs.   Other  mills 
that  normally  operated  on  their  own  accounts  accepted  commission  weaving  or- 
ders.  The  supply  of  second-hand  looms  available  for  purchase  at  low  prices 
from  19S0  to  1933,  and  the  lack  of  other  opportunities  for  employment,  kept 
many  small  operators  in  business  who  worked  on  commission  at  cut  rates. 

Aii  accompanying  development  in  this  situation  has  been  the  rising  im- 
portance of  a  group  known  as  converters.   Their  activities  consist  chiefly  of 
buying  cloth  in  the  greige  (unfinished)  and  finishing  or  "converting"  it 
(dyeing,  printing,  etc.),  but  they  also  buy  raw  materials  and  have  the  goods 
woven  by  commission  weavers. 

For  a  short  time  the  converters'  relations  with  the  commission  weavers 
were  -pofcsi'H.y  a.  boon  tqths  industry  __  particularly  the  small  mills.   The 
abundance  of  commission  weavers,  however,  offered  the  converters  an  oppor- 
tunity for  trading  around,  especially  since  the  converter  would  * iu yoently 
not  onlv  buy  the  raw  material  and  style  the  fabrics,  but  also  advance  money 
for  payrolls. 

This  centralization  of  activities  in  the  hands  of  the  converter  has  re- 
sulted in  a  shifting  of  the  control  of  the  Industry  from  the  manufacturer  to 
the  merchandiser.   Despite  this  acquisition  of  power,  the,  converters  have  re- 
mained very  mobile  for  they  have  no  investment  in  plants  or  equipment,  and 
consequently  the;''  are  able  to  move  from  weaver  to  weaver,  wherever  they  can 
get  the  work  done  most  cheanly. 

Number  of  Establishments 

In  1929  1/    there  were  approximately  1,491  establishments  in  the  Silk  In- 
dustry as  a  whole.   In  1931  these  had  decreased  to  1,211,  and  in  1933  to 
1,087,  cue  perhaps  to  the  failure  of  a  number  of  small  enterprises.   (See 
table  I).   The  boom  in  the  Industry  at  the  inception  of  the  codes  brought  the 
number  back  to  1,250  in  1934.  2/ 

Size  of  Establishments 

The  Silk  Industry  as  a  whole  is  comprised  of  approximately  twice  as  many 
small  enterprises  as  large  ones,  in  terms  of  looms  operated  and  amounts  of 
money  invested.   The  turn-over  among  these  small  firms  is  very  high,  a  condi- 
tion which,  it  has  been  asserted,  has  been  due  in  most  instances  to  unscrupu- 
lous converters  upon  whom  this  groun  is  very  dependent. 

1/  From  1921  to  1929,  1,218  concerns  with  61,987  looms  entered  business,  while 
1,093  concerns  with  61,363  looms  went  out  of  business.   National  Federation 
of  textiles,  Inc  .,  Production  and  Distribution  of  Silk  and  Hay on  Broad 
Goods  (1935),  p. 22 

2/  Number  registered  with  the  Code  Authority. 

RP.AT> 


Included  in  the  silk  and  rayon  industry  are  35  mills  with  1,000  looms  or 
more  each,  which  own  35  per  cent  of  the  total  number  of  installed  looms.   There 
is  another  group  of  mills  —  about  325  —  which  owns  from  100  to  1,000  looms 
each,  or  48  per  cent  of  the  total  installed  looms.   A  still  larger  group  of 
840  mills  owns  less  than  100  looms  each.,  or  17  per  cent  of  the  total  installed 
loomage.  1/ 

Number  of  Establishments  "by  States 

The  Industry  is  centered  primarily  in  the  Northeastern  area  of  the  United 
States,  with  Pennsylvania  and  New  Jersey  the  most  important  centers.   The 
greatest  concentration  of  companies  and  looms  is  in  the  Paterson,  Few  Jersey, 
section,  which  accounted  for  19,500  of  New  Jersey's  25,000  looms  in  1954.   The 
migration  of  looms  from  there  to  small  Pennsylvania  towns  since  1929  placed  the 
latter  state  first,  however,  with  respect  to  number  of  establishments  and  looms 
in  1933  end  1934.  Tables  I  and  II  give  a  distribution  of  establishments  and 
looms,  o-y   principal  states.   The  six  leading  states  shown  in  Table  I  comprised 
94  per  cent  of  the  total  number  of  establishments  in  1929,  92  per  cent  in  1931, 
and  93  -oer  cent  in  1933. 

TABLE  I 

Number  of  Establishments  in  the  Silk  Industry  as  a 
Whole,  by  Principal  States 

State  Number  of  Establishments 

1929  1931  1933 

U.  S.  Total  1,431  1,211  1,087 

Connecticut  38  37  36 

Massachusetts  42  38  42 

New  Jersey  631  448  378 

New  York  157  129  107 

Pennsylvania  497  430  397 

Rhode  Island  43  41  36 

All  Other  States         83  88  91 


Source:   Census  of  Manufactures,  "Silk  and  Rayon  Manufactures".   Data  for  es- 
tablishments with  an  annual  production  of  less  than  $5,000  in  value 
are  not  included. 

TABLE  II 

Number  of  Looms  Installed,  by  Principal  States,  1934 


State  Number  of  Looms 


Total  92,355  a/ 

(Continued  on  following  page) 


1/  Statement  of  Peter  Van  Horn,  Chairman  of  the  Silk  Code  Authority,  at  a 

public  hearing,  "Tashington,  1,1  y  ';1,  1935. 
8647 


-6- 

TABLE  II 

(Cont 

id) 

New  Jersey 

25 , 000 

Pennsylvania 

37 , 713 

Massachusetts 

3 ,  012 

PJioc'.e  Island 

5,036 

Connecticut 

4,764 

New  York 

8,544 

Virginia 

1,998 

North  Carolina 

2,542 

South  Carolina 

753 

Georgia  and  Alabama 

565 

Tennessee 

273 

Other  2,155 


Source:   The  National  Federation  of  Textiles,  Inc.,  Production  and  Distribu- 
tion of  Silk  and  Rayon  Broad  Goods  (1935). 

a/     The  National  Federation  of  Textiles  estimated  in  the  transcript  of 

the  hearing  for  the  Code  in  September,  1933,  that  there  were  105,000 
looms  in  operation  or  available;  this  number  is  at  variance  with  the 
above  data. 

Mills  Operating  in  More  than  One  State 

Table  III  shows  that  there  were  at  least  304  mills  in  1930  which  were 
owned  by  companies  operating  in  more  than  one  state.  Nearly  two- thirds  of 
these  mills,  which  were  owned  by  a  total  of  79  comnanies,  belonged  to  com- 
panies operating  mills  in  two  states. 

TABLE  III 

Number  of  Silk  and  Rayon  Companies  Having  Mills  in  More 

than  One  State,  Classified  by  Number  of  States  in 

Which  They  Operate,  1930 

Number  of   States   in  i/hich        Number  of  Number  of 

Mills  are   located  Companies  Mills 

Total  79  304 

Two  States  59  195 

Three  States  13  56 

Four  States  4  28 

Five  States  3  25 


Source;   NRA  Research  and  planning  Division,  special  report  of  May  2,  1935,  by 
Victor  von  Szeliski.   Compiled  from  Davison's  Textile  Blue  Book,  193C. 

Capital  Investment  and  Financial  Condition 

The  total  capital  investment  in  the  Industry  is  unknown.   However,  a 
8647 


-7- 


rough  estimate  would  possibly  place  it  at  about  $545,000,000  for  the  Silk.  In- 
dustry as  a  whole.  1/ 

The  capital  investment  of  a  sample  of  107  silk  companies,  as  reported  in 
1934  to  the  Federal  Trade  Commission,  is  shown  in  Table  IV.   Table  V  shows  the 
financial  condition  of  the  same  107  companies.   Additional  evidence,  though 
fragmentary,  of  the-  financial  condition  of  the  Silk  Industry  is  presented  in 
Table  VI,  which  compares  the  rate  of  return  on  capital  stock  equity  in  silk 
and  other  textile  industries.   According  to  the  Federal  Trade  Commission  re- 
raort  from  which  this  table  is  also  taken,  it  is  based  upon  a  somewhat  larger 
sample  of  the  Industry  than  are  Tables  IV  and  V. 

TABLE  IV 

Capital  Investment  of  107  Silk  Weaving  and  Throwing 
Companies,  1933  and  the  First  Six  Months  of  1934  a/ 


Six-Month  Period 


Total  Investment  b/ 


January  to  June,  1933 
July  to  December,  1933 
January  to  June,  1934 


$63,576,875 
63,491,623 
63,196,362 


Source:   Federal  Trade  Commission,  Textile  Report  Part  IV,  Silk  and  Rayon 
Industry. 

a/    The  sample  consists  of  107  companies  which  constitute  15.7  per  cent 
of  the  total  number  of  establishments,  as  reported  by  the  Census  for 
1933.   It  includes  41  companies  weaving  silk  and  rayon  on  commission 
and  66  comoanies  throwing  and  weaving  their  own  silk  and  rayon. 

b/    Total  investment  is  inclusive  of  good  will. 

TABLE  V 

Total  Net  Income  Before  Interest  and  Net  Income  Trans- 
ferred to  Surplus  of  107  Silk  Weaving  and  Throwing 
Companies,  1933  and  First  Six  Months  of  1934  a/ 


Six-Month  Period 


Total  Net  Income 
Before  Interest 


Net  Income 
Transferred 
to  Surplus 


January  to  June ,  1933 
July  to  December, 1933 
January  to  June ,  1934 


$284,881 

1,640,592 

D  -  442,458 


D  -  $548,866 

873,707 

D  -1,030,51V 


D  -  indicates  deficit. 
Source:   Federal  Trade  Commission,  Textile  Report,  Part  IV,  Silk  and  Rayon  Ind. 
a/     The  sample  consists  of  107  companies  which  constitute  15.7  per  cent  of 
the-  total  number  of  establishments,  as  reported  by  the  Census  for  193' 
It  includes  41  companies  weaving  silk  and  rayon  on  commission,  and  66 
cormanies  throwing  and  weaving;  their  own  silk  and,  rayon. 


1/  Estimated  by  the  NRA,  Research  and  Planning  Division  from  Federal  Trade 
Commission  Report;  the  estimate  was  made  on  the  basis  of  the  ratio  of 
looms  and  spindles  in  the  Trace  Commission  sample  to  the  total  in  the  In- 
dustry. 

8647 


-8- 

TABLE  VI 

Rate  of  Return  on  Capital  Stock  Equity  in  Specified 
Divisions  of  the  Textile  Industries,  1933  and  1934 


Division 

fber  of 

Per  Cent 

;  Return 

Nun 

F 

irst 

Second 

F; 

irst 

July- 

Companies 

Half 

Half 

Half 

Augus  t 

1933 

1933 

1934 

1934 

Spinning 

Cotton 

84 

1.43 

8.97 

3.84 

D-  3.67 

Wool 

33 

7.50 

13.55 

2.81 

D-11.25 

Silk  and  Rayon 

(Throwing) 

11 

7.10 

D-  1.34 

2.50 

D-  4.03 

Silk  and  Rayon 

( Commission 

Throwing) 

43 

2.84 

D-  0.81 

1.07 

D-  2.56 

Weaving 

Cotton 

44 

1.05 

8.54 

0.59 

D-  4.85 

Wool 

12 

D- 

6.01 

29.79 

D- 

8.05 

D-21.47 

Sill:  and  Rayon 

43 

D- 

3.16 

14.48 

D- 

7.21 

D-12.44 

Silk  and  Rayon 

(Commission) 

41 

D- 

7.32 

2.75 

D- 

4.62 

7.60 

Spinning  and  Weaving 

Cotton 

206 

4.71 

11.55 

5.36 

D-  2.08 

Wool 

79 

0.73 

16.25 

0.36 

D-  8.18 

Sill:  and  Rayon 

12 

D- 

3.19 

3.97 

jy. 

5.20 

D-  1.40 

Silk  and  Rayon 

( Commission) 

5 

0.06 

1.53 

D- 

3.10 

D-  2.19 

Dye  in;-;  and  Finishing 

Cotton 

4 

6.81 

15.16 

3.87 

D-  5.59 

Cotton  (Commission) 

71 

4.98 

3.19 

4.94 

D-15.56 

Wool 

5 

D~ 

0.80 

17.85 

D- 

7.88 

D-  3.13 

Silk  and  Rayon 

(Commission) 

46 

D- 

5.37 

D-11.80 

D~ 

1.67 

D-16.81 

Average  for  Industries 

Cotton 

409 

4.33 

10.41 

5.01 

D-  3.64 

Northern  Mills 

104 

0.62 

6.84 

D~ 

0.02 

D-  6.10 

Southern  Mills 

230 

6.48 

13.82 

8.07 

D-  0.10 

Dyeing  and  Finish- 

ing 

75 

5.13 

4.18 

4.85 

D-14.69 

Wool 

129 

1.62 

16.03 

D- 

0.04 

D~  8.70 

Silk 

201 

D- 

3.15 

D-  2,ia 

D- 

2.76 

D-  9.U6 

Thre  ad 

19 

12.81 

12.24 

: 

13.33 

5.51 

Cordage 

7 

12.11 

12.70 

13.40 

2.21 

Total 

765 

3.93 

10.45 

4.21 

D-  4.21 

D 


indicates  deficit, 


Source:   Federal  Trade  Commissi -n,  Textile  Report, (1934  -  1935). 
Figures  compiled  from  InrtG  I  -  IV. 


8647 


-9- 

Fai lures 

Bun  and  Bradstreet,  Inc.,  l/  reported  that  10  companies  failed  in  the  Silk 
Textile  Industry  as  defined  "by  the  Code,  in  193^»  "°"at  gave  no  statement  as  to 
the  amount  of  liabilities.   The  number,  however,  would  appear  to  be  underesti- 
mated, particularly  in  view  of  the  fact  that  so  many  small  shops  are  constantly 
entering  and  leaving  the  field  2/ 

Volume  and  Value  of  Production 

It  is  interesting  to  note  from  Table  VII  that  although  the  total  volume  of 
production  of  "broad  goods  apparently  declined  only  slightly  from  1929  to  1933} 
the  value  of  the  product  dropped  tremendously.   For  example,  the  yardage  prod- 
uction of  "broad  goods  declined  less  than  7  Per  cent,  "but  the  value  fell  a"bout 
62  percent.   The  volume  of  production  in  ribbons  is  not  shown,  "but  the  value, 
is  approximately  57  Per  cent  lower.   One  cause  for  this  situation,  aside  from 
the  general  depression  and  the  drop  in  raw  sill:  prices,  has  "been  the  terrific 
competition  from  rayon.  (Cf.  Chart  I,  Chapter  III). 

TABLE  VII 

Value  and  Volume  of  Production  of  Broad  Goods,  and  Value 

of  Ribbons  Produced 
(in  thousands) 

Broad  Goods  a/ Ribbons   

Year        Value       _ Volume  Value  Volume 

(square  yards) 

1929  $UHs,30S  597, llU  $25,008 
1931  2Si,6i7  566, S6H  15,3SS 
1933 ISk.^Gk  558.881 10,SU7 


Source:   Census  of  Manufactures,  "Silk  and  Rayon  Manufactures";  data  for  estab- 
lishments with  an  annual  production  of  less  than  $5,000  in  value  are 
not  included.   It  is  possible  that  tie  fabrics,  hat  bands,  and  labels 
ma.y  be  included  in  the  tabulations.   However,  the  per  cent  represent- 
ed b;r  these  items  would  probably  be  snail. 

a/       Except  velvets,  plushes,  upholsteries,  tapestries,  etc. 

Estimated  Total  Productive  Capacity 

It  is  estimated  that  the  potential  yardage  capacity  of  the  Industry,  for 
a  standard  weight  and  length  of  cloth  (such  as  can  be  produced  at  the  rate  of 
2q-  yards  per  loom  hour),  for  50  weeks  a  year  (allowing  2  weeks  for  a  normal 
shut-down  period  for  repairing  equipment  ant"  vacations) ,  at  Uo  hours  per  week, 
would  be  525  million  yards,  and  at  SO  hours  per  week,  1,050  million  yards.  3/ 
It  must  be  pointed  out  that  this  production  estinate  would  vary  greatly  accord- 
ing to  the  construction  of  the  cloth.   The  peal:  consumption  year  was  192S,  when 
U25  million  yards  of  silk  were  sold. 

l/  Current  Analysis  of  Insolvency  Trends,  February  3S,  1935* 

2/   National  Federation  of  Textiles,  Inc.,  Production  of  Silk  ana  Raynn  Bioad  Gocc 

3/  As  estimated  in  NBA,  Research  and  Planning  Division,  preliminary  report  on 

the  Silk  Textile  Industry,  by  W.  C.  Henderson,  April,  1935* 
S6U7 


■•      m   ■"■*'    ■        .:•:  -    -■  ■-..,■  .         ..■■■■' 


-10- 

Estimated  Unused  Productive  Capacity 

Table  VIII  is  indicative  of  the  unused  capacity  in  the  Industry.   This 
table  shous  that  the  hours  of  operation  per  loon  omed  (which  ^ould  appear  to 
take  into  consideration  the  idle  looms)  declined  from  an  average  of  4S.1  hours 
per  neek  in  1929  to  32.2  hours  in  1932.   The  average  uas  36. 4  hours  during  the 
first  10  months  of  1934. 

Over  the  ten-year  period,  1923  to  1933,  there  was  an  average  monthly  ex- 
cess of  goods  -oroduced  over  normal  sales  and  stocks  of  about  23  million  yards. 
1/ 

TABLE  VIII 

Activity  of  Broad  Looms  Owned  "by  Stock-Carrying 
Hills  and  Commission  Weavers,  1929  -  193^ 


Month 


January 
February 

March 

April 
May 

June 


Average  Weekly  Hours  of  Machine  Operations, 

Per  Loom  Otrned 

1929  1930 


46.0 

47.  s 
1+8.1 

4s.  1 
Us.  5 
48.4 


50.7 
52.6 

53-3 


42.2 
37-9 


1951 


1932 


45.1 
46. 3 
U5.0 


U3.6        U3.6 


36.6 

36.3 


42.7 

35.3 


2  0.  7 
19.0 


1933 


43.0 

3S-7 
27.2 

28.4 
36.2 
35r9 


1934  a/ 


39-5 

49.2 

48.4 

43!  s 
29.4 
36.0 


July 

August 
September 


47.9 
4S.9 

4S.3 


38.0 

35.1 

38.4 


3br7 
3S.1 

43.5 


dd,o 

32.4 
40.2 


39,3 

33.5 

25.6 


32,5 

35.1 
27.7 


October 

November 

December 


49.2 
48.6 
47.2 


42.3 
46:3 
4r.i 


44. 7 
4o.3 
42.9 


40 ;  6 

36.6 
39*9 


30.3 
33-2 
35.0 


22.4 


Average 


48.1 


44.2   41.6 


32.; 


33.9 


Source:   The  National  Federation  of  Textiles,  Inc.,  Production  and  Distribu- 
tion of  Silk  and  Payon  Broad  Goods  ( lr  3 n) .  ^ 

a/     Average  for  first  10  months  of  1934  -jar.  36.4  hours;  series  has  since 
"been  discontinued. 

Conroetition  from  Other  Industries 


The  Silk  Textile  Industry  feels  the  effect  of  direct  competition  from 
cotton-mi1.!  products  made  of  silk,  or  rayon,  or  other  synthetic  fibres,  end 
garments  made  from  the  same  fi"bres.   Indirect  competition  comes  from  fabrics 
of  cotton  or  wool,  or  combinations  thereof. 

1/  Henderson  report  cited  above,  and  statement  of  Prank  Schweitzer  represent- 
ing the  United  Textile  Workers  at  Code  Hearing  September  12,  1933. 

8647 


-11- 

The  keenest  and  perhaps  the  most  destructive  competition  this  Industry 
has  had,  both  before  and  during  the  period  of  Code  operation,  has  resulted 
from  the  weaving  of  rayon  and  silk  in  the  Cotton  Textile  Industry  which  paid 
lower  wages  and  could  consequently  offer  the  market  substantially  the  same 
fabrics  at  more  attractive  prices.. 

Products  Used  by  Other  Industries 

The  Code  for  the  Silk  Textile  Industry  divided  the  Industry  into  several 
divisions  and  stipulated  standard  terms  of  sale  for  each  division.   A  good 
portion  of  the  output  of  each  division  is  sold  to  other  industries;  the  divi- 
sions, together  with  the  principal  industries  which  use  their  products,  are 
indicated  below. 

1.  The  largest  division  is  composed  of  the  weavers  and  converters  of 
broad  goods  -  plain  and  Jacquard.   The  stock-carrying  mills  in  this 
grout)  sell  to  the  cutting-up  trade  -  that  is,  to  dress  and  garment 
manufacturers  and  furriers.   They  also  sell,  of  course,  to  converters 
and  to  the  wholesale  and  retail  trades.   The  commission  weaving  mills 
sell  only  their  services,  and  those  for  whom  they  weave  -  chiefly  the 
converters  -  must  in  turn  dispose  of  the  cloth  approximately  as  the 
stock-carrying  mills  do. 

2.  The  special-fabrics  group,  which  makes  only  fancy  and  novelty  mater- 
ials, disposes  of  its  production  to  the  same  group  of  purchasers  as 
the  ordinary  broad-goods  manufacturers. 

3.  The  ribbon  group,  which  weaves  ribbon  material  usually  18  inches  or 
less  in  width,  depends  almost  entirely  upon  garment  manufacturers, 
milliners,  typewriting  ribbon  manufacturers,  florists,  and  the  like 
for  its  business. 

4.  The  woven-label  group  is  practically  entirely  dependent  upon  other 
industries  for  existence  -  underwear,  garment,  millinery,  hat,  cloth- 
ing, dress,  shoe,  and  numerous  others. 

5.  The  hat-bank  group,  naturally,  sells  its  nroducts  to  the  hat  and 
millinery  industries. 

6.  Sewing  threads  are  sold  to  the  dress,  cloak  and  suit  trades,  and 
other  industries;  flosses  are  sold  to  machine  and  handknitting  es- 
tablishments. 

7.  The  tie-fabrics  group,  as  its  name  implies,  sells  its  product  to 
the  neckwear  industry. 

8.  The  spun-yarn  group  derives  a  good  portion  of  its  business  from  other 
industries,  such  as  hosiery,  underwear,  outerwear,  and  other  knit 
goods  industries.   The  Code  also  specifies  trade  terms  for  a  group 
"Thrown  silk,  thrown  rayon,  and  synthetic  yarn  dealers",  which  sells 
materials  to  the  same  industries  as  tha-  snun  silk  group. 


8647 


-12- 

CHAPTER  II 

LABOR 

Total  Number  of  Employees 

According  to    Census  data  the   average  number  of  wage   earners  employed 
in  the   Silk  Industry  as  a  whole   declined  from  130,467   in  1929  to   109,225  in 
1931,   and  rose   in  1933  to   110,322.      (See   Ta"ble   IX).      The   estimate  for  1934 
is  116,200  wage   earners  1/ . 

A  monthly  index  of  employment    in  1933  and  1934  is   shown   in  Table  XII, 
There  appears   to   be   a  wide   fluctuation  in  employment   —   the   index  ranging  in 
1933  from  84,5  in  April,   to   123  in  August   and  in  1934  from  77  in  September  to 
117  in  February  —  but   the   seasonal  pattern   is  not  very  definite  for  these 
two  years  at   least. 

Number  of  Employees  by  States 

Table  IX  shows  the  average  number  of  wage  earners  in   the   Industry  as  a 
whole,  by  principal   states.      It   is  interesting  to  note   that   the  decline  in 
employment  in  the  principal  manufacturing  states  -  Pennsylvania,  New  Jersey 
and  New  York  -  has  been  rather  severe,   whereas  there  have  been  slight   in- 
creases in  Massachusetts  and  Rhode   Island,    and  approximately  a  45  per  cent 
increase  in  "All  Other  States,"  which  are  principally  in  the   south.     This 
movement  may  be  attributed  to   several  causes,    among  which  are  the  attempts 
of  manufacturers  in  the  former  states  to   seek  lower  wage  levels  and  to  es- 
cape labor-union  activity. 

Evidence  of  this  shift  may  be   summarized  as  follows:      the   six  leading 
states  comprised  91  per  cent   of   the   total  number  of  wage   earners   in  1929,   87 
per  cent  in  1931,    and  84  per  cent   in  1933, 

Total  Annual  Wages 

The  total   annual  wages  paid  by  the  Industry  as  a  whole  declined  from 
$137,547,146   in  1929  to   $97,409,000   in  1931   and  to   $74,098,215   in  1933   (See 
Table  X) .      It   is  estimated  that   in  1934  wage  payments  rose  to  $05,384,000.   2/ 

Annual  Wages  by   States 

Annual  wage  payments  in  the  principal   silk-manufacturing  states  are   shown 
in  Table  X,      It    is   significant    that   total  wages  in   "All  Other   States,"  which 
are  principally   in  the   south,   were   little   higher   in  1933  than   in  1929,    al- 
though the  number  of  wage   earners   in  these   states  had  increased  from  40   to 
45  per  cent, 

1/  Estimate  for  1934  is  based  up^n  Bureau  of  Labor  Statistics  index  of  factory 
employment  of  "Silk  and  Rayon  Goods"  adjusted  to  1933  Census  totals  by  NRA, 
Research  and  Planning  Division. 

2/  Estimate  for  1934  is  based  upen  Bureau  of  Labor  Statistics  index  of  factory 
payrolls  for  "Silk  and  Rayon  Goods,"  adjusted  to  1933  Census  totals  by  NRA, 
Research  and  Planning  Division. 

8647 


-13- 

The  proportion  of  the  total  wages  paid  in  the  six  leading  states  has 
declined  from  93  per  cent  in  1929  to  89  per  cent  in  1931  and  06  per  cent  in 
1933. 

Percentage  Labor  Cost  is  of  Total  Value 

The  percentage  which  labor  cost  is  of  total  value  of  products  in  the 
Silk  Industry  increased  from  about  19  per  cent  in  1929  to  25.5  per  cent  in 
1933,  This  increase  in  relative  proportion  which  labor  forms  of  the  total 
value,  is  due  in  large  part  to  the  decline  in  raw  material  costs  (cf.  Table 
XVI). 

TABLE  IX 

Average  Number  of  Wage  Earners   in  the   Silk  Industry  as 
a  Whole,   by  Principal   States 

Number   of  Wage  Earners  a/ 


10,501 

9,662 

8,527 

7,390 

6,939 

9,270 

21,419 

13,626 

10,705 

10,261 

7,290 

6,114 

61,544 

49,938 

49,215 

7,589 

7,060 

9,187 

State 1929 1931 1933 

TJ.    S.   Total  130,467  109,225  110,322 

Connecticut 
Massachusetts 
New  Jersey 
New  York 
Pennsylvania 
Rhode  Island 

All  Other  States  12,063  14,710  17,295 

Source:  Census  of  Manufactures,  "Silk  and  Rayon  Manufactures."  Data  for 
establishments  with  an  annual  production  of  less  than  $5,000  are 
not    included. 

a/  Employees   include   skilled  and  unskilled  workers   on  payrolls  during 

week   including  the   15th  of  each  month.      Averages  for  1929  and  1931 
cover   12  months;    for  1933  iha  averages  cover  March,   June,    September, 
and  December. 


S647 


-lH- 

TABLE  X 

Annual  Wages  in  the  Silk  Industry  as  a  Whole,  by  Prin- 
cipal States  (In  thousands) 


■   . 

Total 

Annual  Wa^es 

State 

1929 

1931 

1933 

U.   S.  Total 

$137,547 

$97,409 

074, 

,098 

Connecticut 

12.046 

10,208 

7, 

,049 

Massachusetts 

7.105 

5,810 

*>i 

,515 

New  Jersey 

28 , 100 

15,009 

8, 

,522 

New  York 

11,621 

7,419 

4 

,548 

Pennsylvania 

59,013 

40,815 

30, 

,259 

Rhode  Island 

8,558 

6,952 

6, 

,629 

All  Other   Stai 

;es 

10,304 

11,197 

10, 

,576 

Source:      Census 

of 

J'anuf  actur 

es,    "Silk  and  Rayon  Manuf 

actures." 

Data  for 

establishments  with  an  annual  production  of  less  than  $5,000  are 
not  included. 

Average  Hourly  and  Weekly  Wapes,  and  Hours  Worked 

The  changes  in  average  hourly  earnings  in  the  Industry  as  a  whole  since 
1929  are  summarized  in  Table  XI.   It  appears  from  this  that  average  hourly 
earnings  in  1934  were  higher  than  in  1929  -  44.9  cents  as  compared  with  42. S 
cents.  However,  during  the  same  period  the  hours  worked  per  *.7eek  were  re- 
duced from  48  to  33,  with  the  result  that  average  weekly  earnings  which  were 
$21.16  in  1929  dropped  to  $14.85  in  1934. 

TABLE  XI 

Average  Hourly  and  Weekly  Wages  and  Average  Hours  Worked 
Per  Week  in  the  Silk  Industry  as  a  Whole 


Year 


Average 
Hourly 
Wage  a/ 


Average 
Weekly 
Wage  b/ 


Average  Hourj 

Worked 
Per  Week  a/ 


1929 
1931 
1933 
1934 


$ 


.426 
.409 
.353 
.449 


$21.16 
17.88 
13,14 
14.85 


40.0 
44.2 
37.6 
33.0 


Source:  As  indicated  in  footnotes. 

a/     1929  and  1931  data  are  from  National  Industrial  Conference  Board, 
Service  Letters,  with  adjustment  downward  so  as  to  he  comparable 
with  Bureau  of  Labor  Statistics  series.   1933  and  1934  data  from 
Bureau  of  Labor  Statistics,  Trend  of  Employment. 

b/     Bureau  of  Labor  Statistics,  Trend  of  Employment. 


8647 


-15* 

Effect  of  the  Code  on  Wages  and  Hours 

The  monthly  variations  in  working  time  and  earnings  in  the  Industry  as 
defined  "by  the  Code,  for  the  years  1933  and  1934,  are  shown  in  Table  XII. 
The  figures  are  unpublished  data  obtained  by  the  Bureau  of  Labor  Statistics 
from  a  representative  sample,  the  size  of  which  is  indicated  in  the  foot- 
notes of  the  table.  These  data  differ  slightly  from  those  shown  in  Table 
XI,  due,  presumably,  to  the  fact  that  the  samples  are  not  identical,  but  the 
discrepancies  are  slight.   The  effect  of  the  NBA  on  hours  and  wages  is 
evident  from  Table  XII,  which  shows  that  from  August,  1933  on,  hours  of  work 
were  reduced  and  hourly  earnings  were  increased. 

Similar  information  by  states  for  1931  and  1934  is  shown  in  Table  XIII. 
The  figures  in  this  table  are  from  two  different  sources  (see  footnotes)  and 
are  probably  not  strictly  comparable.  1/  Nevertheless,  they  are  indicative 
of  the  effect  of  the  Code  in  different  sections  of  the  country.  The  Southern 
States,  for  instance,  had  a  longer  working  week  in  1931,  but,  with  the  ex- 
ception of  North  Carolina,  had  much  lower  weekly  earnings  than  the  Northern 
States  because  of  the  low  wage  rates  in  the  south.   In  February,  1934,  how- 
ever, the  working  week  in  the  Southern  States  was  about  the  same  as  in  the 
Northern  States.  Weekly  wages  in  the  south  were  still  lower  than  in  the  north, 
but  the  disparity  was  much  narrower  than  in  1931  because  wage  rates  had  been 
raised. 


1/   The  earnings  and  hours,  in  February,  1934,  as  shown  in  Table  XIII,  are 

higher  than  those  shown  for  February  in  Table  XII.   Even  though  the  figures 
in  Table  XIII  may  have  an  upward  bias,  they  no  doubt  reflect  geographic 
differences  with  sufficient  accuracy  to  be  useful. 


8647 


-16- 


TAELE  XII 


Employment,  Payrolls,  Hours  and  Wages  in  the  Industry 
as  Defined  "by  the  Code,  1933  -  1934  a/ 


Month  b/      Indexes,  1933  =  100 

1933      Employ-  Pay-     Man- 

ment  c/  rolls  c/  hours  d/ 


Average 
Hours 
Worked 
Per  Week 


Wages 


Average 
Hourly  ej 


Average 
Weekly  c/ 


Jan. 

Peh. 

Mar. 

Apr. 

May 

June 

July 

Aug. 

Sept, 

Oct. 

Nov. 

Dec, 

Average 

1934 

Jan. 

Peh. 

Mar. 

Apr. 

May 

June 

Ju.ly 

Aug. 

Sept. 

Oct. 

Nov. 

Dec. 

Average 


96.2 
94.3 
85.4 
84.5 
93.2 
97.6 

108.6 
123.2 
115.8 
94.8 
102.9 
103.6 

100.0 


100.7 
117.3 
117.5 
111.3 
102.8 
108.6 

105.7 
101.5 
77.0 
100.8 
102.9 
105.0 

104.9 


87.7 
87.4 
73.8 
72.4 
85.7 
89.0 

107.4 
138.9 
118.2 
108.4 
116.9 
114.1 


102.6 

102.4 

86.8 

84.6 

94.5 

101.0 

116.1 

123.6 

105.2 

91.6 

97.0 

93,3 


100.0        100.0 


115.2 
140.0 
140.8 
132,9 
113.4 
123.5 

115.3 
116.2 
77.2 
120.9 
120.4 
126.4 

120.2 


94.4 
113.1 
111.4 
103,7 

91.2 
100.1 

92.4 
92.7 
59.6 
95.1 
96.0 
99.8 

95.8 


40.4 
41.1 
38.5 
37.9 
38.4 
39.5 

40.7 
38.0 
34.4 
36.6 
35.7 
34.1 

37,9 


32.9 
36.5 
35.9 
35.3 
33.6 
34.9 

33.1 

34.6 
29.3 
35.7 
35.3 
36.0 

34t4 


31.5^ 

30.9 

32.0 

33.0 

32.1 

31.0 

32.9 
41.2 
42.2 
44.1 
44.0 
44.0 

36.6 


44.1 
44.4 
44.8 
45.8 
44.8 
44.8 

44.8 
44.0 
47.1 
45.8 
45.7 
45.3 


45.) 


$12.75 
12.95 
12.07 
11.97 
12.80 
12.69 

13.05 
15.02 
14.30 
16.02 
15.75 
15.10 

13,84 


14.61 
16.34 
16.44 
16.40 
15.18 
15.63 

14.98 
15.69 
13.65 
16.33 
15,96 
16.41 

15,64 


Source: 
a/ 

V 

at 

8647 


Unpublished  data  secured  hy  the  Bureau  of  Labor  Stati.-.tics  in  coopera- 
tion with  the  Division  of  Research  and  Planning,  NBA, 
Haporting  establishments  considered  to  be  almost  completely  covered 
by  the  Silk  Textile  Code. 

Pigures  reported  were  for  the  payroll  period  nearest  the  15th  of  the 
month. 

Based  upon  a  representative  s-mple  covering  an  average  of  108  estab- 
lishments and  more  than  19,000  employees  in  1933.   The  sample  was 
somewhat  larger  in  1934. 

Computed:   Index  of  employment  times  average  hours  worked  per  week  re- 
duced to  1933  =  100, 

Based  upon  a  representative  sample  covering  an  average  of  58  estab- 
lishments and  nearly  12,800  employees  in  1933,  The  sample  was  much 
larger  in  1934, 


-17- 

TABLE  XIII 

Average  Hours  and  Earnings  "by  States  in  the  Industry  as  a  Whole, 

1931  and  1934 


Averages  in  1931  a/ 


State 


Hours 
Worked 
Per  Week 


Earnings 
Per  Hour 


Actual 
Earnings 
Per  Week 


Averages  in  February,  1934. 

Hours  Earnings  Per  Week 

Worked  On  40-    Esti- 

Per  Hour      mated 

Week  b/  Basis  b/  Actual  c/ 


Connecticut  47.8 

Massachusetts  42.7 

New  Jersey  42.4 

New  York  45.8 

Pennsylvania  45.4 

Rhode  Island  45.0 

Maryland  46.3 

North  Carolina  49.9 
South  Carolina 

Alabama  & 

Georgia  50.4 

Tennessee  49,9 

Virginia  48.0 

Total  45.5 


5.459 
.367 
.500 
.400 
.392 
.495 
•  253 
.382 


.268 
.196 
.292 

.406 


$23.04 
17.95 
23.60 
19.88 
20.07 
24.75 
13.03 
21.09 


14.85 
11.05 
15.77 

20.58 


38.2 
36.1 
37.9 
38.9 
37. S 
39.7 

35.1 


39.5 
39.2 
38.3 

37.9 


>20.15 
20.45 
20.92 
17.75 
18.43 
18.73 

17.03 


15.53 
15.01 
15.79 

19.03 


$19.24 
18.45 
19.82 
17.26 
17.32 
18.59 

14.94 


15.34 
14.71 

15.12 

18.03 


Source:  As  indicated  in  footnotes. 

a/    Bureau  of  Labor  Statistics,  Wages  and  Hours  of  Labor  in  the  Manu- 
facture of  Silk  and  Ravon  Goods.  1931  (Bulletin  No.  568).   Figures 
were  collected  for  a  representative  week  in  the  period  of  March, 
April,  May  and  June. 

b/    National  Federation  of  Textiles,  Inc.,  Production  and  Distribution 
of  Silk  and  Ravon  Broad  Goods  (1935),  p.  29. 

c/    Estimated  by  multiplying  the  average  weekly  wages  on  a  40-hour 

basis  by  the  ratio  of  the  average  hours  worked  per  week  to  40  hours, 

Tables  XIV  and  XV  furnish  a  comparison  of  hourly  earnings  of  male  and 
female  employees  in  the  leading  manufacturing  centers  of  the  Silk  and  Rayon 
Goods  Industry  in  August,  1933,  and  August,  1934.  Tha  number  of  workers  in 
all  sections  receiving  less  than  30  cen'js  an  hour  was  greatly  diminished  in 
1934,  In  the  south  the  greatest  concentration  of  workers  in  1934  was  in  the 
wage  classification  30- to  32.5  cents,  but  in  the  other  sections  larger  pro- 
portions of  the  workors  were  grouped  in  the  higher  wage  brackets. 

Number  of  Weeks  Workfid 

No  information  is  readily  available  on  the  number  of.  weeks  worked.  per1 
year  in  the  Silk  Industry. 


8647 


-IS- 


Child  Labor 

For  the  Silk  Industry  as  a  whole  the  Census  of  Occupations  in  1930 
listed  3,596  children  under  16  years  of  age.   It  should  be  noted  that  this 
figure  refers  not  to  the  number  actually  employed  but  rather  to  the  number 
reporting  themselves  as  belonging,  by  occupation,  to  this  Industry.  Al- 
though it  is  undoubtedly  true  that  child  labor  still  exists  to  some  extent, 
it  seems  reasonable  to  believe  that  it  has  been  greatly  reduced. 

TABLE  XIV 


Hourly  Earnings  in  the  Silk  and  Rayon  Industry,  by  Sex  and  Region, 

August  1933 


Number  of 

Employees 

Hourly 

Earnings 

South  a/ 

Middle 

Atlantic  b/ 

Paterson 

S/ 

New 

England  d/ 

Male   Female  Male 

Female 

Male 

Female 

Male 

Female 

Less  than 

$.225 

100 

141 

333 

336 

28 

40 

51 

107 

$•225  "•  $, 

.275 

46 

35 

132 

269 

25 

33 

46 

81 

.275  -  , 

.300 

31 

34 

59 

65 

6 

7 

21 

44 

.300  -  ; 

.325 

.239 

296 

128 

131 

18 

20 

35 

52 

.325  -  , 

.350 

98 

143 

891 

3424 

78 

466 

417 

1108 

.350  -  , 

,400 

184 

216 

602 

1338 

113 

158 

438 

936 

.400  -  , 

.450 

232 

127 

883 

522 

115 

96 

339 

585 

.450  -   , 

.500 

187 

70 

501 

225 

188 

60 

345 

515 

.500  -  , 

.600 

214 

48 

766 

230 

199 

76 

545 

528 

.600  -  , 

,700 

137 

9 

469 

100 

95 

23 

365 

179 

.700  and 

over 

44 

1 

364 

31 

165 

7 

413 

76 

Total  Number 

of  Employees 

in  Sample 

1512 

1170 

5128 

6671 

1030 

936 

3015 

4211 

Source: 


Bureau  of  Labor  Statistics,  Textile  Report,  Part  II,  "Wage  Rates 
and  Weekly  Earnings  in  the  Silk  and  Rayon  Goods  Industry  from  April 
1933  to  August  1934,"  p.  28. 

The  largest  figure  in  each  column  is  underscored. 


a/ 

22/ 
Si 


Alabama,   North  Carolina-   Virginia. 

Pennsylvania,  Upstate  New  York,  Philipsburgh  and  Burlington,   N. 

Paterson,   N.   J.,    and  environs. 

New  York  City  and  New  England. 


J. 


-19- 


TABLE  XV 


Hourly  Earnings  in  the  Silk  and  Rayon  Industry,  "by  Sex  and  Region, 

August  1934 


y 


11 

umber  of 

Employ 

ses 

Hourly 

Earnings 

South  a/  M 

iddle 

Atlantic 

5/ 

Pater son  c/ 

Hew  England  d/ 

Male 

Female 

Male 

Female 

Male  Female 

Male 

Female 

Less  than 

$. 

225 

6 

2 

32 

20 

2 

8 

4 

3 

$.225  - 

$.275 

21 

25 

147 

86 

13 

21 

22 

23 

.275  - 

.300 

37 

7 

30 

26 

5 

5 

5 

11 

.300  - 

.325 

299 

599 

41 

58 

16 

20 

17 

20 

.325  - 

.350 

65 

132 

1084 

4385 

70 

267 

391 

891 

.350  - 

.400 

226 

169 

848 

2236 

91 

272 

519 

995 

.400  - 

.450 

224 

149 

1055 

1088 

134 

114 

459 

660 

.450  - 

.500 

198 

67 

1071 

645 

173 

88 

429 

444 

.500  - 

.600 

247 

101 

1143 

534 

233 

122 

622 

481 

.600  - 

.700 

162 

29 

800 

238 

124 

34 

601 

241 

/ .700  and  over 

66 

5 

907 

88 

221 

19 

S77 

94 

Total  Number 

of  Employees 

in  Sampl 

.e 

1551 

1285 

7158 

9404 

1082 

970 

3646 

3863 

Source:  Bureau  of  Labor  Statistics,  Textile  Report,  Part  II,  "Wage  Rates  and 
Weekly  Earnings  in  the  Silk  and  Rayon  Goods  Industry  from  April  1933 
to  August  1934",  p.  28. 

The  largest  figure  in  each  column  is  underscored. 

a/  Alabama,  North  Carolina,  Virginia. 

b/  Pennsylvania,  Upstate  Ne\7  York,  Philipsburgh  and  Burlington,  H.  J. 

c/  Paterson,  N.  J.  and  environs. 

d/  Hew  York  City  and  New  England. 


8647 


-20- 

CHAPTER  III 

MATERIALS  -  RAT/  A1ID  SEMI -PROCESSED 

Total  Cost  of  Raw  Materials 

The  amounts  spent  for  raw  materials  by  the  Silk  Industry  as  a  whole  have 
declined  from  $412,181,260  in  1929  to  $212,846,607  in  1931,  and  to  $143,611,- 
431  in  1933.  l/  The  sharp  decline  in  raw  silk  prices  and  the  increasing 
amounts  of  rayon  used,  which  are  indicated  in  Charts  I  and  II,  2_/  account  for 
a  large  part  of  decrease  in  raw  material  costs. 

Per  Cent  Cost  of  Materials  is  of  Total  Value 

The  proportion  which  raw  materials  costs  represents  of  the  total  value 
of  products  in  the  Industry  as  a  whole  is  shown  in  Table  XVI  to  have  declined 
from  56.4  per  cent  in  1929  to  49.4  per  cent  in  1933.  l/ 

TABLE  XVI 

Percentage  Labor  and  Raw  Material  Costs  Are  of  Total 
Value  in  the  Silk  Industry  as  a  Whole 


Total  Value     Total  Factory       Total  Materials 
Year  of  payroll  Cost  a/ 


Products        Amount    Per  Cent   Amount     Per  Cent 

of  Total  of  Total 


1929  $731,200,231  $137,547,146  18.8  $412,181,260  56.4 
1931  422,771,960  97,409,008  23.0  212,846,607  50.3 
1933         290,577,662   74,098,215    25.5    143,611,431   49.4 


Source:  Census  of  Manufactures,  "Silk  and  Rayon  Manufactures".  Data  for 
establishments  with  an  annual  production  of  less  than  $5,000  are 
not  included. 

a/  Total  cost  of  materials  includes  fuel  and  purchased  electrical 
energy  which  amounted  to  2.1  per  cent  of  the  total  in  1927  and 
1929. 


1_/  These  figures  include  expenditures  for  fuel  and  purchased  electrical 
energy  which  amounted  to  2.1  per  cent  of  the  total  in  1927  and  1929. 

2/   Chart  II  depicts  total  textile  fibre  consumption  and  is  not  limited 
to  consumption  by  the  Silk  Textile  Industry. 


8647 


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-23- 

Principal  ' later i?.ls  Used 

The  principal  materials  user  in  the  Silk  Textile  Industry  as  a  whole  are 
shown  in  Table  XVII.   Silk,  of  course,  is  by  far  the  most  important  material, 
but  increasing  quantities  of  rayon  are  being  used.   Silk  mills   increased  their 
rayon  consumption  from  1,900,000  pounds  in  I91U  to  40,700,000  pounds  in  1931, 
and  to  60,000,000  pounds  in  193!+«   The  consumption,  of  raw,  thrown,  and  spun 
silk  has  increased  from  29,500,000  pounds  in  1914  to  64, 200,000  pounds  in  1929. 
Consumption  has  since  declined  to  5?, 700,000  pounds  in  1931,  and  to  an  estimat- 
ed 45, 500,000  pounds  in  193^«   *n  addition  to  silk  and  rayon,  the  Industry  uses 
small  quantities  of  cotton  yarn  and  other  fibres. 

TAEL2  XVII 

Quantity  and.  Cost  of  Principal  Materials  Consumed  by 
the  Silk  Industry  as  a  'Jhole,  1929  and  1931 


Kind  of  Material       1Q29  1931 

Quantity  Cost  Quantity      Cost 

(Founds)  (Pounds) 

Silk  ~~ 

Raw                                54,  1+73,331  $267,027,248  '    47,436,042  $116,091,275 

Organizine                           1,666,070  10,07^,253  902,430         3,065,417 

Tram                                             7^5,865  2,97S,3lU  369, 3°6         1,135,353 

Hard  and  Crepe 

twist                             6,180,199  35,410,495  .3,707,593      26,232,^97 

3-o,:i                                1,152,224  3,912,537  1.2.96,^57       3,365,145 

piorcec   Cocoons, 

etc.                                         2,227,122  7,622,627  .  3,7.1S,'57l*         1,459, 5hd 

Rayon  Yarns                         32,551,60*  44,937,707  •.    40,742,062       36,732,072 

Cotton  Yarns                       13,26Q,609  2,121,631  12,233,932         1^813,349 

Other  Yarns                            2,217, 004  3,659,629  . 2,452,790         3,236,792 

s 

Total,  above 

items           121,129,029  $383,768,528  117  =  915. 192  $196,757,542 


Source:   Census  of  Manufactures.   "Silk  and  Rayon  Manufactureis" . 

Data,  for  establishments  with  sn   annual  production  of  less  than  $5,000 
are  excluded. 

Expenditures  for  Principal  Raw  Materials 

The  Industry's  expenditures  for  various  raw  materials  cannot  be  shown  in 
detail.   The  amount  spent  for  raw  silk,  which  is  the  principal  raw  material  0. 
the  Industry,  declined  from  $267,000,000  in  1929  to  $116,000,000  in  1951  for 
the  Industry  as  a.  whole.   Although  the  quantity  of  rayon  yarns  consumed  has  i: 
creased,  the  expenditures  for  r;  yon  nave  decreased  from  $44,900,000  in  19'- 9 
to  $36,700,000  in  1931.   Comparable  data  am  not  available  for  later  years. 
(See  Table  XVII>. 


2647 


Source  of  Bay.'  Materials 

A"bout  SO  per  cent  of  the  raw  silk  usee,  in  this  country  in  1933  was  import- 
ed from  Japan.   Host  of  the  remainder  came  from  China  and  Italy,  l/  Practically 
all  of  the' rayon  used  is  produced  domestically  —  in  Pennsylvania,  New  York, 
Virginia,  T7est  Virginia,  and  Ohio. 

Machinery  and  Equipment 

No  data  are  available  on  recent  expenditures  made  hy  the  Industry  for 
machinery  and  equipment.   It  is  the  author's  opinion,  however,  that  such  out- 
lays must  have  "been  relatively  small. 

According  to  Census  data,  the  leading  machinery  and  equipment  manufactur- 
ers are  located  in  New  York,  Pennsylvania,  Rhode  Island,  New  Hampshire,  and 
Illinois.  A  very  small  amount  of  equipment  is  imported  from  England  and  Ger- 
many. 


1/  Bureau  of  Foreign  and  Domestic  Commerce,  Porcim  Commerce  and  Navigation 
of  the  United  States.  1931. 

S6U7 


-25- 

CHATTSR  IV 

PRODUCTION  AND  DISTRIBUTION 

Value  of  Production  in  Principal  States 

Table  XVIII  shows  the  value  of  goods  produced  in  the  Industry  as  a 
whole,  "by  leading  states.   In  193.3  Pennsylvania  produced  silk  and  rayon 
goods  valued  at  almost  $110,0^0.000,  and  Nov;  Jersey,  which  was  second  in 
importance,  $31,555,000.   The  percentage  decline  in  value  of  products  be- 
tween  1929  and  1935  has  varied  widely  among  the  leading  states.   In  Pennsyl- 
vania the  decrease  was  about  66  per  cent;  in  New  York,  73  per  cent;  in  New 
Jersey,  75  per  cent;  but  in  Rhode  Island  the  decrease  was  only  about  30  per 
cent. 

The  six  states  shown  in  Table  XVIII  produced  91  per  cent  of  the  total 
value  of  products  in  1929,  83  per  cent  in  1931,  and  82  per  cent  in  1933. 

TABLE  XVIII 

Value  of  Products  in  the  Silk  Industry  as  a  Whole,  by  Principal  States 

(in  thousands) 


State 


1929 


1931 


1933 


U.  S.  Total 

Connecticut 
Massachusetts 
New  Jersey 
New  York 
Pennsylvania 
Rhode  Island 

All  Other  States 


$731,200 

54,298 

37,413 
126,308 

90,238 
320,956 

35,658 


66,355 


^422,772 

56,756 
22,920 
58,050 
49,457 
167,520 
26,475 

71 , 654 


$290,578 

25,245 
25,937 
51 \ 555 
25,966 
109,925 
24,965 

55,009 


Source:   Census  of  Manufactures.  "Silk  and  Rayon  Manufactures".   Data 
for  establishments  with  an  annual  Production  of  less  than 
$5,000  are  not  included. 

Shift  in  Centers  of  Production 

There  have  been  some  changes  in  the  relative  importance  of  the  various 
centers  of  production,  although  the  Paterson,  New  Jersey,  area  and  the  Pennsyl- 
vania sections  still  maintain  the  lead.   However,  in  the  last  decade  several 
of  the  Southern  states  —  North  Carolina  particularly  —  have  grown  in 
prominence  as  producing  areas,  although  practically  all  of  the  dyeing  and 
finishing  is  still  done  in  New  Jersey  and  the  adjacent  New  York  Sectiono 
(cf.  Chapter  II,  section  entitled  ""lumber  of  Smplo?/ees  by  States"). 


8647 


-26- 

Exports 

The  amount  of  silk  goods  and  silk  yarn  exported  from  the  United 
States  has  never  been  very  large,  out  exports  in  1933  and  1934  were  small- 
er than  at  any  time  for  at  least  the  past  15  years.  As  shown  in  Table  XIX, 
both  the  volume  and  value  of  practically  all  types  of  silk  products  ex- 
ported decreased  "between  1929  and  1934.   However,  the  exportation  of  tram 
(silk  yarn)  increased  slightly  in  volume,  although  the  value  greatly  de- 
creased. Both  the  volume  and  value  of  exports  of  rayon  products  have 
increased  since  1929. 


8647 


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Table  XX  shows  the  principal  countries  to  which  silk  fabrics  are 
exported*   The  only  country  which  showed  an  increase  in  the  amount  import- 
ed from  the  United  States  between  1930  and  1934  was  the  Philippines. 

TABLE  XX 


Volume  and  Value  of  Exports  of  Broad  Goods  Made  TTholly  or  Chiefly  of 
Silk,  by  Country  of  Destination,  in  1930,  1931,  1933,  and  1934 

(in  thousands) 


Country 

IS 

130 

193] 

1 

.933 

1934 

a/ 

Quantity  Value 

Quant  i  t 

y  Value 

Quantity 

■  Value 

Quantity  Value 

(yards) 

(yards) 

(yards) 

(yards) 

Canada 

1,448 

$1,709 

1,534 

$1, 

583 

229 

$  202 

260 

$196 

Cuba 

697 

667 

343 

259 

153 

61 

134 

64 

Australia 

186 

267 

100 

110 

84 

47 

177 

119 

Philippines 

111 

117 

194 

128 

768 

324 

421 

208 

Mexico 

50 

90 

25 

42 

18 

25 

5 

7 

United 

Kingdom 

76 

139 

76 

78 

56 

50 

50 

44 

Dominican 

Republic 

25 

23 

25 

18 

16 

11 

10 

6 

Colunbia 

23 

22 

46 

21 

8 

9 

9 

10 

Argentina 

51 

79 

31 

43 

5 

9 

5 

2 

Hawai  i 

270 

148 

186 

111 

Puerto  Rico 

194 

65 

161 

66 

Other 

Countries 

221 

308 

170 

154 

119 

72 

78 

51 

Total 

2,887 

$3,423 

2,594 

$2; 

,365 

1,980 

$1,023 

1,493 

ijjOOO 

Source:  Nat 

■  ional  Federation 

of  Text 

iles,  Inc 

. ,  Production  and  Distribution 

of 

Silk  and 

Rayon  B 

road  Goo 

ds 

(1935 

),  p.  41, 

1 

a/ 


Nine  months  only. 


Advertising 

Various  advertising  media  are  used,  but  there  are  no  available  data  as 
to  the  amount  of  expenditures.  A  few  of  the  leading  producers  who  advertise 
and  sell  under  their  own  brands  are  Cheney  Brothers,  Stehli  Silk  Corporation, 
Julius  Kayser  and  Company,  Belting-Heminway-Corticelli,  Inc.,  and  Van  Raalte 
Company,  Inc.   Not  many  others  sell  trade-marked  goods. 


Comparison  of  Production  and  Retail  Sales  by  States 

A  comparison  of  the  value  of  production  of  silk  and  rayon  broad  goods 
with  the  retail  distribution  of  these  products  for  specified  states  is  given 
in  Table  XXI.   The  value  of  products  represents  the  total  value  of  silk  and 
rayon  broad  goods  (exclusive  of  velvets,  plushes,  and  upholsteries)  produced 
in  establishments  classified  in  the  Census  of  Manufactures  under  "Silk  and 

8647 


-29- 

Rayon  Manufactures".   The  estimated  value  of  retail  soles  for  each  of  the 
states  shown  consists  only  of  sales  made  in  the  three  types  of  stores  — 
department,  dry-goods,  and  general  merchandise  —  hut  the  hulk  of  silk  and 
rayon  goods  is  sold  in  such  stores,  (See  footnote  d/  of  Tahle  XXI).  Be- 
cause the  sales  figures  cover  velvets,  etc.,  while  the  production  figures 
do  not,  and  because  the  Census  data  on  retail  sales  are  for  various  reasons 
not  completely  satisfactory  for  deriving  commodity  sales,  the  comparison 
is  necessarily  rough. 

The  limitations  of  the  data  require  that  conclusions  drawn  from 
them  he  guarded.   It  is  evident,  he 'ever,  that  the  manufacture  of  silk  hroad 
goods  is  concentrated  in  a  few  st?  tes  in  the  Eastern  part  of  the  country, 
hut  that  retail  sales  are  net  concentrated  to  anything  like  the  same  e;:tent. 
For  example,  in  19£9  Pennsylvania  produced  about  48  per  cent  of  the  total 
output,  but  consumed  something  in  the  neighborhood  of  only  about  8  per  cent. 
Similarly  Her  Jersey  produced  abort  19  per  cert  of  the  total,  but  used  only 
about  2  per  cent.   At  the  other  end  of  the  scrle  are  found  states  like 
Missouri,  Washington,  Kansas,  Iowa,  Louisiana,  and  many  others  that  are  not 
shown,  where  consumption  amounts  to  one  or  more  per  cent,  all  of  which  has 
to  be  brought  in  from  outside  the  state,  since  there  is  no  production  with- 
in these  states. 


8647 


-30- 


TABLE  XXI 


Value  of  Production  and  Estimated  Retail  Sales  of  Silk  and  Rayon 

Broad  Goods,  by  States,  1929 


State 


Total  Production  a/    Estimated  Total  Retail  Sales  b/ 


Value  of 

Production  Per  Cent 

(Thousands)  of  Total 


Number  of   Value  of 
Establish-  Sales  cj     Per  Cent 
ments       (Thousands)  of  Total 


U.  S.  Total 

$483,208 

ICO 

41,702 

$236,634 

300 

Connecticut 

18,577 

1 

631 

1,828 

1 

Massachusetts 

22 , 943 

4 

1,394 

8,960 

4 

New  Jersey 

92, 132 

19 

2,053 

5,537 

2 

New  York 

45,337 

9 

4,956 

29,960 

13 

Pennsylvania 

231,375 

43 

3,117 

17,717 

8 

Rhode  Island 

23,341 

5 

294 

978 

Washington 



562 

3,317 

1 

Kansas 



616 

2,580 

1 

Iowa 



633 

2,952 

1 

Missouri 



1,389 

6,906 

3 

Louisiana 



605 

3,358 

1 

Other  States 


53,203 


11 


25,397 


152,541 


65 


Source: 


a/ 


6/ 


2/ 


Census  of  Manufactures,  1929;   and  Census  of  Retail  Distribution, 
1929. 

Silk  and  Rayon  broad  goods  exclusive  of  velvets,  plushes,  etc. 
Data  for  establishments  v,ith  an  annual  production  of  less  than 
$5,000  are  not  included. 

As  reported  bv  three  kinds  of  retail  establishments: 

(1)  Department  stores  with  and  without  food 
departments. 

(2)  Dry  goods  stores  (dry  goods  and  piece  goods)  and 

(3)  General  merchandise  stores  (with  and  without 
food  departments). 

Value  of  sales  has  been  estimated  by  multiplying  the  total 
net  sales  of  department,  dry  goods,  and  general  merchandise 
stores  by  the  per  cent  which  sales  of  rayon  and  silk  and 
velvet  piece  goods  were  of  total  sales  of  all  stores  in 
these  categories. 


8647 


CHAPTER  V 
TRADE  PRACTICES 

Unfair  Trade  Practices  prevalent  Before  Code  1/ 

The  Sill:  Textile  Industry,  like  most  of  the  other  textile  industries, 
was  plagued  by  unfair  trade  practices  "before  the  Codes  were  adopted. 

Possibly  the  nost  widespread  unfair  practice  has  been  the  exploitation 
of  commission  weavers  by  the  converters.  Many  of  the  commission  weavers 
operate  on  a  very  small  scale  with  from  10  to  50  looms.  As  a  group  they 
have  practically  no  "business  training  nor  knowledge  of  costs,  and  they  are 
not  responsible  enough  financially  oven  to  "be  able  to  purchase  raw  materials. 
In  addition,  their  looms  in  virtually  all  instances  are  anticipated.   The 
converters  advance  enough  money  to  the  commission  weavers  to  meet  the  small 
payroll,  and  in  return  for  these  advances  they  receive  silk  yardage  from  the 
commission  weaver  at  very  low  cost.   It  frequently  happened  that  the  small 
weaver  soon  found  himself  unable  to  pay  for  such  items  as  his  rent  and  the 
carrying  charges  on  his  machinery,  and  was  forced  to  accept  foreclosure.   The 
holder  of  the  machinery  lien,  who  was  usually  the  converter,  would  then  either 
set  the  weaver  up  in  business  again  or  move  the  machinery  to  another  small 
operator.   This  cycle  might  be  repeated  time  after  time  and  the  effects 
were  far  reaching.   In  addition  to  the  effects  of  this  method  of  operation 
on  the  commission,  weaver  and  his  employees,  it  enabled  the  converter  to 
offer  low-priced  goods  which  demoralized  the  markets  in  which  the  more 
responsible  and  the  more  efficient  operators  had  to  compete.  Although  the 
quantities  offered  may  not  have  been  large,  they  were  sufficient  to  establish 
price  levels  which  could  be  considered  unfair  to  the  stock-carrying  mills. 

Excessive  weighting  of  silk  materials,  for  the  purpose  of  giving  body  to 
a  sleazy  fabric,  was  -practiced  by  some  manufacturers.   Such  weighting,  which 
greatly  reduces  the  durability  of  the  cloth,  is  believed  to  be  much  less 
widespread  than  formerly. 

Design  piracy,  or  the  stealing  of  patterns  and  styles,  has  long  been  a 
problem  for  which  no  adequate  and  effective  remedies  have  as  yet  been  found. 
There  are  two  schools  of  thought  in  regard  to  the  use   of  designs:  one  school 
demands  strict  governmental  protection  similar  to  the  patent  laws;  the  other 
favors  liberal  and  unrestricted  use  of  all  created  designs. 


1/  It  must  be  noted  that  the  statements  made  in  this  section,  unless  other- 
wise noted,  are  generalities  based  only  on  the  author's  knowledge  of  the 
Industry  and  not  on  any  factual  material  that  can  now  be  presented. 


8647 


As  already  indicated,  the  above  discussion  of  trade  practices  was  drama 
from  the  author's  knowledge  of  the  Industry.  The  "balance  of  this  chapter  is 
based  on  material  prepared  by  tfce  national  Federation  of  Textiles,  Inc. 

According  to  the  iteration,  unfair  trade  practices  prevalent  in  the 
Silk  Textile  IndusW  prior  to  the  Code  were: 

1.  Exc-^sive  terns  given  under  pressure  from  buyers. 

2.  returns  made  for  other  than  reasons  of  unsatisfactory 

merchandise. 

3.  Excessive  claims  for  damaged  merchandise  including  the 

making  of  claims  by  dress  manufacturers  against  several 
manufacturers  in  one  lot  of  dresses  -  the  fabric  not 
being  identifiable  after  having  been  put  into  the  dresses. 

4.  Lack  of  definite  understanding  between  buyer  and  seller  as 

to  conditions  of  sales,  due  to  lack  of  contracts  or  other 
order  confirmations. 

5.  Secret   rebates. 

6.  Commercial  bribery   in   the   form  of  gifts  to  buyers   or  buyer's 

representatives. 

7.  Allowances  for  advertising  which  constituted  in  most  cases 

nothing  more  than  allowances  on  the  price. 
3.   Selling  below  cost. 

The  extensive  use  made  of  these  practices  so  broke  down  the  price 
structure  that  it  was  almost  impossible  for  manufacturers  to  compete  on  the 
basis  of  the  actual  value  of  the  merchandise.   In  other  words,  purchases  and 
sales  became  a  matter  of  barter  on  price  concessions  without  much  relation 
to  the  quality  or  cost  of  producing  the  merchandise.   The  seller  had  to  try 
to  keep  in  mind  at  the  time  of  the  sale  how  many  ways  the  buyer  could  bring 
pressure  on  him  on  subsequent  allowances  through  claims,  returns,  advertis- 
ing allowances,  extra  datings,  cash  rebates,  and  the  like. 

Methods  of  Unfair  Competition  Now  Prevalent 

According  to  the  national  Federation  of  Textiles,  Inc.,  selling  below 
cost  is  still  considered  prevalent  and  there  is  still  complaint  about  return- 
ing merchandise  after  too  long  an  interval,  but  the  abuses  which  resulted 
from  secret  rebates,  advertising  allowances,  trading  down  on  terms,  etc.,  are 
thought  to  have  more  or  less  disappeared. 

Effect  of  Prices  of  Individual  Members  on  the  national  Price  Structure 

In  the  opinion  of  the  National  Federation  of  Textiles,  Inc.,  the  fact 
that  so  much  buying  and  selling  in  the  Silk  Industry  is  done  within  the  Hew 
York  City  area  —  either  through  representatives  of  out-of-town  firms  or  by 
dress  manufacturers  whose  plants  are  in  New  York  —  means  that  any  action 
taken  hj   an  individual  member  of  the  Industry  with  respect  to  trices  quickly 
spreads  throughout  the  Industry.   The  condition  is  aggravated  by  the  over- 
supply  of  merchandise,  which  constantly  exists,  and  the  fact  that  most  of  the 
merchandise  is  not  sold  under  the  manufacturer's  name  or  trade-mark,  but  simply 
goes  into  the  general  pool  of  fabrics  supplied  by  the  several  hundred  manu- 
facturers in  the  Industry. 


8647 


CHAPTER  VI 

GENERAL  INFOaiATION  1/ 

Manufacturer s '  Qrgani zatioiis 

national  Federation  of  Textiles,  Inc.  -  Silk  manufacturers  realized  the 
need  of  cooperative  handling  of  their  problems  at  an  early  date,  and  con- 
sequently organized  the  Silk  Association  of  America  in  June,  1872.   This 
organization  was  one  of  the  earliest  trade  associations  in  this  country 
and  included  in  its  membership  all  of  the  early  manufacturers  and  dis- 
tributors of  silk  fabrics,  as  well  as  the  importers  of  raw  materials. 
The  organization  has  a  long,  uninterrupted  history.   In  1934,  because  of 
the  increasing  importance  of  rayon  in  the  making  of  finer  dress  fabrics, 
the  name  of  the  Association  was  changed  to  the  National  Federation  of 
Textiles,  Inc.   Through  this  organization  the  Silk  Industry  handles  such 
problems  as:  competition  of  foreign  fabrics  which  are  manufactured  at 
much  lower  wage  levels;  encouragement  of  production  of  increased  quantities 
and  better  qualities  of  raw  silk;  development  of  high-speed  machinery  to 
bring  greater  variety  of  fabrics  to  American  consumers  at  prices  not  pos- 
sible in  the  costly  imported  lines;  settlement  of  disputes  by  arbitration 
instead  of  by  relying  on  the  more  expensive  and  often  unsatisfactory 
method  of  settlement  by  jury  trial  in  the  public  courts;  establishment  of 
standard  forms  of  contract  to  minimize  misunderstanding  between  buyers  and 
sellers  and  to  make  available  to  all  trade  customs  that  have  developed 
through  years  of  experience;  standardization  not  only  of  trade  customs  and 
methods  of  manufacture,  but  also  methods  of  merchandising,  including  grad- 
ing and  testing  of  raw  silk;  prevention  of  misrepresentation  of  silk  goods 
through  cooperation  with  the  Federal  Trade  Commission;  and  extensive  tech- 
nical and  scientific  research  on  matters  affecting  the  Industry. 

Broad  Silk  Manufacturers  of  Paterson,  N.  J.  -  This  is  a  local  organiza- 
tion of  small  manufacturers  in  Paterson  who  operate  what  are  known  as  "family 
shops",  in  which  the  owner  runs  his  own  looms  with  the  aid  of  his  family  and 
possibly  a  few  outsiders.   The  group  is  composed  almost  entirely  of  commission 
weavers  who  simply  perform  the  service  of  weaving  for  a  converter  who  supplies 
the  raw  material  and  sells  the  fabric. 

Master  Weavers  Institute.  -  This  organization,  which  is  also  confined 
to  paterson,  consists  of  owners  of  Jacquard  looms.   It  was  formed  primarily 
for  the  purpose  of  putting  through  a  special  labor  agreement,  the  details  of 
which  are  not  known  to  the  author.   The  employees  of  this  group  are  skilled 
and  therefore  receive  relatively  high  wages. 

Blackstone  Valley  Manufacturers  Association,  providence,  R.  I.  -  This  is 
an  organization  of  manufacturers  in  the  Rhode  Island  territory  who,  with  few 
exceptions,  are  of  about  the  same  class  as  the  commission  weavers  forming 
the  Broad  Silk  Manufacturers  Association  of  Paterson. 

Silk  Manufacturers  of  Allertowr,  Pa.  -  The  silk  manufacturers  in  the 
Allentown  section,  many  of  wnom  came  originally  from  Paterson,  are  not  very 
formally  organized  but  do  hold  occasional  meetings. 

1/   The  information  in  this  chapter  is,  with  minor  editorial  changes,  as 
prepared  by  the  National  Federation  of  Textiles,  Inc. 

8647 


Relationship  Between  Labor  and  Management 

Dae  to  the  comparatively  small  size  of  the  individual  enterprises  in 
the  Silk  Industry,  the  relationship  "between  labor  and  management  has  "been 
relatively  close.   The  only  difficulties  of  any  consequence  have  "been 
centered  around  Paterson,  Hew  Jersey.   A  very  serious  strike  occurred  in 
1913,  and  strike  activities  in  other  years  —  together  with  the  higher 
wage  level  there  —  have  caused  a  number  of  manufacturers  to  move  their 
mills  to  smaller  communities  where  the  workers  were  not  organized. 

In  1918  an  Industry-wide  movement  for  trie  inauguration  of  the  48-hour 
week  was  attempted  through  the  United  Textile  Workers  of  America.   It  was 
found,  however,  that  silk  workers  were  not  "anxious"  to  join  the  movement 
and  that  except  in  the  Allentown,  Pennsylvania,  and  paterson,  New  Jersey, 
centers  there  was  little  or  no  difficulty  in  adjusting  the  hours. 

No  significant  labor  difficulties  occurred  from  1918  until  subsequent 
to  the  adoption  of  the  NBA  Code.   In  the  intervening  years  wages  were  in 
general  comparatively  high  until  the  depression.  When  the  wage  market 
broke  the  workers  most  seriously  affected  were  those  in  the  "family  shops" 
and  in  other  shops  operated  without  proper  regard  to  costs.   The  principal 
t method  of  reducing  costs  was  cutting  wages,  and  wages  in  such  shops  were 
reduced  to  "unheard  of"  levels,  despite  the  fact  that  the  average  in  the 
well-established  mills  remained  high. 

It  was  to  be  expected  that  the  Code  —  particularly  the  7  (a)  clause  — 
would  encourage  workers  to  strike  for  better  wages.   The  Code  provided  for 
a  minimum  wage  for  all  workers,  with  a  clause  regarding  differentials  which 
was  not  specific  with  respect  to  the  various  crafts.   In  August,  1933,  a 
general  strike  was  called  in  protest  of  the  proposed  Code;  it  lasted  about 
twelve  weeks.   The  center  of  the  strike  was  in  the  Paterson,  New  Jersey, 
area.   The  strike  was  considered  unsuccessful  to  the  extent  that  the  Code 
minimum  wage  was  not  changed  and  the  compromise  agreement  effected  by  the 
National  Industrial  Labor  Board  was  not  carried  out. 


List  of  Exoei-ts 

Peter  Van  Horn,  Chairman, 
The  National  Federation  of 
Textiles,  Inc. , 
10  East  MOth  Street, 
New  York  City. 


Nathan  Lewis, 
Nairn  &  Peldman,  Inc.  , 
40  E.  29th  Street, 
New  York  City. 


K.  E.  Blake, 
Cheney  Brothers, 
1S1  l.Iadison  Avenue, 
New  York  City. 

Alexander  P.  Ix, 
Frank  Ix  &  Sons.,  Inc. 
1410  Broadway, 
New  York  City. 


Edward  H.  Schniewind, 
Susquehanna  Silk  Hills, 
lH9  lladison  Avenue, 
New  York  City. 

Paul  C.  Debrj'-, 
Duplan  Silk  Corp. 
1H5O  Broadway, 
New  York  City. 


8647 


•35" 


Raymond  C.   Kramer, 
The  Bel&ing**£ieminT7ay 
Corticelli   Co., 
119  17.    Uoth  Street, 
Ne'7  York  City. 


Henry  Z.    Stehli, 
Stelili   Silks   Corp, 
1372  Broadway, 
lie-  York  City. 


John  R.   LicG-inley, 
Phillip  sTmrg  Silk  Co., 
FhillipsTrurg,   l"en  Jersey 


ilotjusulce  Egawa, 
'..orimuira,   Arai  &  Co.  ,    Inc., 
2  Pari:  Avenue, 
He-  York  City. 


R.    K.   Laros, 
R.    K.    Leros   Sill:  Co., 
Bethlehem,   Pennsylvania. 


S6U7#