In 1914, Ford shocked the world, announcing a wage increase from $2.34 to $5.00 per day. The increase was paid as a bonus to men who met Ford’s standards for sober living as verified by Ford Motor Company’s Sociological Department and Harry Bennett’s spies. Henry, meanwhile, would quietly putter up the Rouge from Fairlane in an electric motorboat, docking at a secret staircase in the mansion he built for a young stenographer who joined the company in 1909.
Obviously Ford was no saint. He raised wages out of pure self-interest. His factories were terrible places to work. The new assembly line was mind numbing, backbreaking drudgery. Hundreds lost fingers or limbs in presses and stamping machines every year. Factories were noisy and dirty and the line moved brutally fast, with no breaks. Supervisors had stopwatches. No wonder there was a 10% absentee rate and a turnover rate as high as 370%. In 1913, Ford Motor Company hired over 52,000 men to keep 14,000 employees, something a business model based on productivity could not afford.
The $5 wage stabilized Ford’s workforce. What’s not widely known is that at the same time Ford also shortened the workday. An eight hour day meant the plants could run three shifts, 24 hours a day, speeding production and reducing costs. In 1922, Ford shortened the workweek from the industrial standard of 50 hours, including half a day on Saturday, to a five-day, 40-hour week. That way, with overtime, he could run full shifts on the weekend and keep his plants busy 24/7/365. I’m sure that if Ford had known that safety increased productivity, Henry would have made the plants safer.
Even concerning safety and working conditions, unions’ benefit to non-union workers is somewhat exaggerated. Once again, one can never underestimate the power of selfish interests. E.I. DuPont started a gunpowder mill on the banks of the Brandywine in 1802. He faced some of the same difficulties Henry Ford did in attracting and keeping workers. It was dangerous work. DuPont did something as clever as Ford’s $5 a day wage. He told his employees that if they were killed on the job he’d support their families, perhaps inventing employee life insurance. Then, instead of one large mill, he built several small mills with three stone walls and a fourth of wood facing the river, each designed for one stage of production. In case there was an explosion the wooden panel would blow out towards the river, leaving the walls standing and keeping the explosion from spreading to the entire operation. He also trained his employees to be very, very safe. To this day, “safety first” is DuPont corporate culture. Like Ford, DuPont was no saint, making his fortune from war. He stressed safety because mills were expensive to rebuild, and widows and orphans expensive to support.
Ford and DuPont didn’t act out of the goodness of their hearts. Neither did unions, whose primary accomplishment has been giving individual employees economic leverage, not making the world a better place.
I don’t owe unions any more thanks than I owe Hank and E. I.