Chapter 10
Further Effects of Management and Technology on the Distribution of Labon
Marx has pointed out that unlike generals, who win their wars by recruiting armies, captains of industry win their wars by discharging armies. A necessary consequence of management and technology is a reduction in the demand for labor. The constant raising of the productivity of labor through the organizational and technical means that have been described herein must, in itself, produce this tendency. The application of modern methods of management and machine technology, however, become practical only with the rapid increase in the scale of production. Thus the rapid increase in the productivity of labor tends to be counterbalanced by the growth in production. Chiefly as a consequence of this, employment in those industries concerned with the production of goods has not declined in absolute terms. Statistics which estimate the numbers of workers in those industrial divisions which are directly concerned with the fabrication of goods (including manufacturing, contract construction, mining, lumbering, fishing, and the so-called mechanical industries—the latter being a term used in early censuses) show a constant rise since the earliest occupational census of 1820 (see table, page 164 below). The enormous size of the working population still concentrated in these industries, and the fact that, despite all mechanization, this total has continued to grow until the present, reflects, besides the growth of output, the limits mechanization itself places on the process of labor displacement. The point at which the worker is cheaper than the machinery which replaces him or her is determined by more than a mere technical relationship: it depends as well upon the level of wages, which in turn is affected by the supply of labor as measured against the demand. And the supply of labor, including the size of the reserve army of workers hunting for jobs, depends in part upon the mechanization of industry, which transforms employed workers into surplus workers. Thus the very rapidity of mechanization, insofar as it makes available a supply of cheap labor by discharging workers from some industries or putting an end to the expansion of employment in others, acts as a check upon further mechanization.\*
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Labor and Monopoly Capital
\* It has been pointed out that the transfer machines which characterize so-called Detroit automation were first used by Morris Motors in 1927 but were not considered economical, in view of the relative price of labor power at the time.
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