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Labor was short because the First World War was beginning to siphon off men for work on war material and the armed services

THE $5 DAY: Henry Ford Paid More So Folks Could Buy His Cars, Right? WRONG!

Hank Got Double the Production at Little Increase in Cost, MSU Prof Says

January 7, 2014       Leave a Comment
By: Dave Rogers

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In 1914, Henry Ford started an industrial revolution by more than doubling wages to $5 a day -- a move that helped build the U.S. middle class and the modern economy." -- Ford Motor Co. news release, 6 January 2014.



That myth has been perpetuated through the past century, according to Prof. John Beck of the Labor and Industrial Relations Department, Michigan State University.

And, obviously, today's Ford corporate doesn't want to disabuse anyone of the legend.

Interviewed today on WKAR Radio, East Lansing, Prof. Beck noted a few key developments and aspects of the labor field that are often missed in the myth-making about the $5 day:

*Ford had just instituted the moving assembly line that was new to workers and his labor turnover was 300-400 percent; even piece workers were used to going at their own pace -- the moving assembly line set its own relentless speed that forced workers into a new and uncomfortable zone; Ford had to pay more just to keep a stable work force;

*Labor was short because the First World War was beginning to siphon off men for work on war material and the armed services;

*The labor movement was beginning to kick up its heels; the first sit-down strike in the auto industry was in 1915 at Studebaker, not the better known General Motors sit down in Flint in 1936 (also at the same time at Chevrolet in Bay City); Ford didn't have to deal with labor trouble until the 1940s;

*Although the $5 day made Ford appear to be a philanthropic industrialist concerned about his workers (while giving them the $$$ to buy cars, etc.), he actually was a very conservative ideologue and highly anti-Semitic (among other quirks of character);

Don't forget, not only did Ford boost wages from the previous average of $2.25 a day, he also cut the work day to 8 hours from the previous 9 hours, Prof. Beck points out. Certainly workers keeping up with the assembly line that doubled production were giving him exactly what he needed at a reasonable increase in costs.

Not all workers got the $5 a day; if Ford's Socialization Department visited the home and found a drinker, gambler or unhealthy conditions, the pay was nixed and the worker's future was dim. Immigrants had to be learning English and become Americanized. Talk about Big Brother!

Writer Tim Worstall of Forbes Magazine pointed out in an article last year that women were not eligible for the $5 day, unless they were the sole supporter of their family. And neither were men whose wives worked. So much for Sugar Daddy Ford.

Let's go back to today's Ford news release: "In 1913, to help meet the growing demand for the Model T, Henry Ford turned his attention to improving the manufacturing processes. The business model Ford developed -- production on a grand scale, performed by well-paid workers -- spread throughout the world and became the manufacturing standard for everything from vacuum sweepers to cars, and more."

OUR COMMENT: OK, we can pretty much buy that as a truism and an accurate depiction of Ford's contribution to industry. But paternalism had little to do with it; he was a wise old fox, doubling production with the moving line without having to add to his workforce.

The Ford statement again: "The moving assembly line was perhaps Ford Motor Company's single greatest contribution to the automotive manufacturing process. First implemented at the Highland Park plant in Michigan, the new technique allowed individual workers to stay in one place and perform the same task repeatedly on multiple vehicles that passed by them.

"The moving assembly line proved tremendously efficient, helping the company to far surpass the production levels of its competitors while making its vehicles more affordable. "After the success of the moving assembly line, Henry Ford had another transformative idea: in January 1914, he startled the world by announcing that Ford Motor Company would pay $5 a day to its workers. The pay increase would also be accompanied by a shorter workday (from nine to eight hours). While this rate didn't automatically apply to every worker, it more than doubled the average autoworker's wage.

While Henry's primary objective was to reduce worker attrition -- labor turnover from monotonous assembly line work was high -- newspapers from all over the world reported the story as an extraordinary gesture of goodwill."

OUR COMMENT: It sure looked like that, and the idea has been perpetuated although basically untrue.

"After Ford's announcement, thousands of prospective workers showed up at the Ford Motor Company employment office. People surged toward Detroit from the American South and the nations of Europe. As expected, employee turnover diminished. And, by creating an eight-hour day, Ford could run three shifts instead of two, increasing productivity." (Aha! The eight hour day also allowed three shifts instead of two!)

Prof. Beck points out that a major source of labor came from Michigan's Upper Peninsula where the Copper Strike had put thousands of miners out of their jobs. Ironically, the strike's genesis was mainly the result of automation, too -- the one man drill displacing half the workforce below ground.

Henry Ford had reasoned that since it was now possible to build inexpensive cars in volume, more of them could be sold if employees could afford to buy them. The $5 day helped better the lot of all American workers and contributed to the emergence of the American middle class. In the process, Henry Ford had changed manufacturing forever.

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Dave Rogers

Dave Rogers is a former editorial writer for the Bay City Times and a widely read,
respected journalist/writer in and around Bay City.
(Contact Dave Via Email at carraroe@aol.com)

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