DEMAND AND SUPPLY IN PRACTICE..............PART II
Let us now push our inquiry a step further. Let us suppose that all servants profiting at last by the good advice to which they have always been liberalie treated, have by a strenuous effort raised themselves to a pitch of efficiency never before witnessed.
According to the theory that merit will always be rewarded, the wages of these servants ought to rise in proportion. But they won't. If, other things remaining the same, all servants were to double their efficiency within the next ten years; the result would be a fall in the rate of wages. For one man would then do as much as two men do at present, and consequently fewer hands would be wanted.
A large number would thus be thrown out of employment altogether, and the pressure of competition would lower the wages of those employed to the very lowest point at which bare existence is possible. Or if we suppose that the work to be done increases as fast as the efficiency of those who do it, wages would still remain stationary.
Imagine a man whose labour in common with that of all his fellow-servants throughout the country has doubled in efficiency. Suppose that he goes to his master and claims increase of wages on the ground that his labour is more profitable. His master would reply -
"I know very well that your labour is better than it used to be, but you are not singular in that respect. It is an age of progress, everybody is better than he used to be, but it doesn't follow that everybody is to be better off. You must remember that the price of work is not regulated by its efficiency or by the wants of the workman, but only by the quantity that happens to be in the market. At present the market is overstocked; if you leave to-morrow I can get dozens of superior workmen like yourself to take your place for your present wages, perhaps for less. Go back to your work and learn to be content with the position in which Providence has placed you - you will find it best."
That would be the real substance of the answer though perhaps it might not be quite so candidly spoken; and the servant would have to digest it as best he could.
From the foregoing we may learn the following things.......
Honest work always has its reward, but it by no means follows that the man who did the work will get the reward. Generally speaking he has to be content with a small part of it.
A good servant will not command a high wage merely because he is good, nor will a bad one always be poorly paid because he is bad. But a man will be well-paid if he is better than others, and ill-paid if he is worse than others. So that a bad servant may actually command better wages than a good one, merely because he is surrounded by servants as bad as himself.
It is not at all to the interest of servants to increase the efficiency of their work; on the contrary it makes the struggle for existence harder for the weak and unskilful without conferring any benefit upon the average, though increasing for a time and only for a time the wages of a few superior ones. Hence the rule of trades-unions against too much work.
Every good servant that appears, diminishes the reward of good service by making it more easily got. Hence the objection of trade-unions to apprentices.
5th and lastly
Competition among servants if suicidal folly; and can have in the long run no effect but to enable masters to screw down the general rate of wages. Its temporary effect is to give some servants better wages than the average; but their increase is taken from their fellow servants, not from their masters. Competition among servants never adds a single penny to the total amount of wages; on the contrary it is the most powerful instrument at the command of capitalists for keeping wages down. Hence trade-unionism; which, be it right or wrong, is an inevitable result of the law of demand and supply.