N3r THE LIBRARY OF THE NEW YORK STATE SCHOOL OF INDUSTRIAL AND LABOR RELATIONS AT CORNELL UNIVERSITY FAMILY BUDGETS OF AMERICAN WAGE-EARNERS A CRITICAL ANALYSIS Research Report Number 41 September, 192 i National Industrial Conference Board THE CENTURY CO. NEW YORK PUBLISHERS Copyright, 1921 National Industrial Conference Board FOREWORD Public interest in the cost of living and family budgets has been aroused within the past few years, primarily as result of the great importance attached to the matter in the adjustment of wage rates. In many of these wage arbitrations there has been much confusion in the use of budgets, and conclusions often have been drawn from them which were not warranted. The National Industrial Conference Board, in connection with its studies of the cost of living among wage-earners in specified localities and of changes in the cost of living generally in the United States, has had occasion to analyze in some detail reports of such investigations of this subject as have been made by other individuals and organizations. Certain conclusions stand out clearly from this mass of material when it is classified and arranged in order. The present report summarizing these conclusions is pub- lished by the Board in order to assist in removing the prevailing misunderstanding of data in this field and the existing confusion in connection with the use of family budgets, especially in wage adjustments. LJT" Cornell University Library The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924002665036 CONTENTS Introduction ] I. Studies of Budgets for the Country as a Whole 4 Investigation by the United States Bureau of Labor, 1900-1902 5 Investigation by the British Board of Trade, 1909... 8 Investigation by the United States Railroad Wage Commission, 1917 9 Investigation by the United States Bureau of Labor Statistics, 1918-1919 10 Conclusion 12 II. Local Studies of Family Budgets 13 New York City, 1903-1905 14 New York City, 1907 16 Buffalo, 1908 18 Homestead, 1907-1908 18 Three Southern Cotton Mill Communities, 1908 . 20 Fall River, 1908 21 Chicago, 1909-1910 22 Philadelphia, 1913-1914 23 New York City and Buffalo, 1914 25 District of Columbia, 1916 26 Dallas, 1917 28 Philadelphia, 1916-1918 29 Conclusion 30 III. The Standard of Living 33 Minimum American Budgets 38 New York City, 1915 38 New York City, 1918 40 Local Studies by the National Industrial Conference Board 40 Summary 41 Minimum Comfort Budgets 41 San Francisco, 1917 42 Seattle, 1917 43 New York City, 1918 44 Washington, 1919 44 Bituminous Mining Towns, 1 920 46 New York City, 1920 48 Summary 48 Conclusion 49 IV. The Typical Family 51 Size and Composition of the Family 52 Sources of Income 53 Conclusion 59 V. Incomes and Expenditures 60 Distribution of Income to the Principal Budget Items 60 Income in Relation to Expenditure, 1901 and 1918.. 63 Conclusion 68 VI. General Conclusions 69 History and Method of Budget Studies 69 Purpose of Budget Studies 70 Use of Budget Studies 71 VII. The Cost of Living and Wage Adjustments 73 Earliest Use of Family Budgets in Wage Adjust- ments 73 Shipbuilding Cases, 1917 74 Early Street Railway Cases, 1917 75 Cases before the National War Labor Board, 1918-1919 76 Later Street Railway Cases, 1919-1921 78 The Bituminous Miners' Case, 1920 80 Cases Before the United States Railroad Labor Board, 1920, 1921 81 The Anthracite Miners' Case, 1920 83 Conclusion 84 LIST OF TABLES PAGE Table 1 : Family Budgets for the Country as a Whole. . . 4 Table 2: Family Budgets in Specified Localities 14 Table 3 : Estimates of the Minimum Cost of Living for aFamily of Two Adults, and Three Children under 14 Years of Age, in Specified Localities 35 Table 4: Sources of .Income, Average Number of Children at Home, Average Number of Persons per Family, in 3,215 Families in the United States in 1909, by Average Weekly Income 55 Table 5: Average Number of Persons per Family, Average Annual Income, Average Proportion of the Income Contributed by the Father, and Average Percentage of Families Having Income from Children, in the United States in 1918-1919, by Income Groups. 57 Table 6: Percentage of Total Yearly Expenditure for Each of the Major Items in the Budgets of 11,156 "Normal" Families in the United States in 1900-1902, by Classified Income 61 Table 7: Percentage of Total Yearly Expenditure for Each of the Major Items in the Cost of Living in Wage-Earners' Families in 92 Industrial Centers of the United States in 1918-1919, by Income Groups. . . 62 Appendix Table A: Average Cost of Living among White Families in 35 Shipbuilding Centers in the United States in 1917-1918 89 Appendix Table B: Average Cost of Living among White Families in Each of 92 Separate Localities in the United States in 1918-1919 90 LIST OF CHARTS PAGE Chart 1: Sources of Income in 3,215 Families in the United States, Studied by the British Board of Trade in 1909, by Average Weekly Income 56 Chart 2: Average Proportion of the Income Con- tributed by the Father, and Average Percentage of Families Having Income from Children, among 12,096 White Families in the United States, Studied by the United States Bureau of Labor Statistics in 1918-1919, by Income Groups 58 Chart 3: Percentage of Total Yearly Expenditure for Each of the Major Items in the Budgets of 11,156 "Normal" Families in the United States, Studied by the United States Bureau of Labor in 1900-1902, by Classified Income 61 Chart 4: Percentage of Total Yearly Expenditure for each of the Major Items in the Budgets of 12,096 White Families in the United States, Studied by the United States Bureau of Labor Statistics in 1918-1919, by Income Groups 62 Chart 5: Percentage of Total Yearly Expenditures Allotted to each of the Major Items in the Family Budgets of Average Wage-Earners' Families in the United States, Studied by the United States Bureau of Labor Statistics in 1900-1902 and 1918-1919 67 Family Budgets of American Wage- Earners : A Critical Analysis INTRODUCTION How much does it cost to live in this country at the present time? How much more does it cost to live now than it did before the war? These two questions are widely discussed to- day. There is a practical interest in this problem not only in wage arbitrations in public utility industries, but also among employers and workers generally, who are attempting to adjust incomes to an harmonious relation with the cost of living. As to how much the cost of living has increased since July, 1914, there seems to be practical agreement. The National Industrial Conference Board estimates that between July, 1914, and July, 1921, the cost of living in the United States increased 63.1%i. The Massachusetts Commission on the Necessaries of Life places the increase within this period at 57.5% in that state. 2 Figures of the United States Bureau of Labor Statistics run consistently higher, for the country as a whole and for separate localities, than any estimates with which they may be compared, and to May, 1921, show an in- crease for the entire United States of 78. 6%. ' These are the only estimates of changes in the cost of living for the country as a whole or any important section thereof, which cover a considerable period of time. By comparing them, and allowing for the fact that the Bureau of Labor Statistics estimate is possibly somewhat too high, it will be seen that the figures of the National Industrial Conference Board repre- sent very fairly the change in the cost of living in the United States since 1914. The question as to how much it cost to live in July, 1921, is, however, a matter about which there is no such substantial agreement. There are several reasons for this, of which four ■National Industrial Conference Board. Research Report No. 39. Changes in the Cost ■ of Living: July. 1914 — July. I92i. 'Massachusetts. Report of the Commission on the Necessaries of Life, February, 1920, p. 118. July, 1921, figures were secured from the Commission in advance of publi- cation. Since the Massachusetts index numbers are based on average ^jrices in the year 1913 as 100, they have been corrected to the base of July, 1914, by dividing them by the index number for that month. 'Monthly Labor Review, November, 1919. P- 193; ibid., July, 1921, p. 112. Original fig- ures are increases above average prices in the year 1913. These have been corrected to the July, 1914, base by dividing the index number for May, 1921, by the index number for July, 1914. 1 demand careful consideration in order to clear up a situation about which there is much misunderstanding. 1. The standard of living varies greatly as between differ- ent groups in the same locality, and it is necessary to estab- lish the particular standard, the cost of maintaining which is to be determined. Confusion has resulted because differ- ent standards have been established by which to measure the cost of living in the same locality without adequate differ- entiation between them. 2. Many circumstances tend to make the cost of living different in different communities, even for persons of the same relative economic and social status. The type of house avail- able, character of clothing worn, kind of fuel and light con- sumed, as well as more general conditions inevitably effect the cost of maintaining any given standard of living. Thus, for a family of the same size and composition to obtain relatively comparable goods and services in one locality may entail a greater or lesser outlay than would be required in another. 3. The family which has been chosen as a measuring unit for the cost of living in different localities in many instances has not been clearly defined, although it usually has been assumed to consist of five persons. For this reason, estimates of cost have been made for families of different age and sex composition and are, therefore, not comparable. 4. The representative character of the family consisting of man, woman, and three children under 14 years of age, where the father is the only wage-earner, has never been established. In making a study of the actual cost of living, therefore, the standard must be specified, and conditions must be studied with reference to a given social or economic group in a given locality. The size and composition of the family should, as far as possible, represent the families in the community. i It thus appears that generalizations regarding the actual cost of living are impossible, since this cost inevitably depends largely on local conditions which vary greatly. A greater con- fusion arises, however, because the other conditions outlined above have not always been kept in mind in making and using local studies of the cost of living. The present report has been prepared in order to help clear up certain misunderstandings regarding the results of family budget studies which have been made in this country in the last few years. Its object is to analyze in detail the more important American studies of family budgets in order to show *As was stated by the chairman of the committee on standard of living of the New York State Conference of Charities and Corrections in November, 1906, "Only those estimates of the cost of a normal standard of living are sound which are based on a given social unit and on the cost of the essential elements in that standard in a given community and at a given time." Chapin, Robert Coit. "The Standard of Living in New York City," New York, 1909, p. 257. the various purposes for which they were made, the method of collecting and presenting the information and the conclusions which may be drawn from the findings. These findings include not only data regarding actual incomes and actual expendi- tures or the estimated cost of living among the groups studied > but also such generalizations as are justified regarding the size and composition of American wage-earners' families, the sources of their income and their standard of living. 2 A chapter on the cost of living and wage adjustments has been included at the end of this report for the purpose of show- ing how family budgets have been used in establishing wages in the United States in recent years. This chapter does not lay claim to completeness nor does it attempt to pass judgment on the legitimacy of using cost of living figures in wage deter- minations. It is a statement of fact on this subject and not of opinion. 'No attempt has been made to relate these all to a commori date, because figures are not available to show how much the cost of Uving has changed in each locality since the original investigation was made. •Family budgets for clerical or professional workers have been less frequently studied than fanuly budgets of wage-earners, and none of the former are included in the present analysis. Some of the most recently collected budgets for salaried and clerical^ workers' families are those studied by the Federal Reserve Board in 1919 and summarized iaFederal Reserve Bidletin, December, 1920, pp. I293-129S. Another study of budgets for clerical workers is that by Mosher, William E., "Quantity and Cost Budgets for Clerical Workers in New York City, April, 1921," issued by the Bureau of Municipal Research, New York, Z92Z. The Federal Reserve Bank of the Ninth District (Minneapolis) also made a study of the cost of living of a family of three persons in the seven principal cities in the district in December, 1920. See Federal Reserve Bank of Minneapolis, Ninth District, MoniMy Report of Crop and Business Conditions, March 29, 1921, pp. 4-5. STUDIES OF BUDGETS FOR THE COUNTRY AS A WHOLE Prior to the investigation of the cost of living among American wage-earners made by the United States Bureau of Labor in 1900-1902,1 a number of studies of the cost of living had been made among selected groups or in limited areas in this country. 2 Since, however, the figures collected in 1900-1902 have fur- nished the basis for subsequent calculations of changes in prices,* and, because of the great body of data assembled, have been the means of checking later studies, it is safe to begin an analysis of contemporary budgets with this particular investigation. Neither the standard of living nor its cost can be accurately determined for the country as a whole since, as already pointed out, identical social and economic conditions affecting this standard and its cost operate over a very limited area. For this reason it is obviously erroneous to assume that results of a general study can be applied to a specific locality or vice versa, or that conditions in one locality are representative of those in others. Nevertheless, an estimate of the cost of living in the United States, based on averages of conditions in a number of localities, has a certain interest, and is useful as affording a means by which specific localities may be compared. The principal value of so broad a study, based on a large number of cases, lies, however, in the light it throws on such general problems as sources of income, distribution of expenditures and similar questions directly affecting although not definitely measuring the standard and cost of living. lUnited States. Commissioner of Labor. Eighteentii Annual Report, "Cost of Living and Retail Prices of Food," Washington, 1903. 2The most interesting of these are contained in the sixth and seventh annual reports of the United States Commissioner of Labor; in the sixth, fifteenth and thirty-second annual reports of the Massachusetts Bureau of Statistics of Labor; and in the tenth annual report of the New York Bureau of Statistics of Labor. The well-known Aldrich Report also contained family budgets which were used as the basis for weighting prices in de- termining increases in the cost of living. "Retail Prices and Wages." S2nd Congress. 1st Session. Senate Report No. 986, Washington, 1892. 'Prices of the various articles used in making up the retail food price index numbers of the United States Bureau of Labor Statistics until January, 1921, were weighted ac- cording to consumption of the articles by families studied in this investigation. The Massachusetts Commission on the Cost of Living in 1910 used these figures as the basis for their estimates of changes in the cost of living in Ma.ssachusetts. Massachusetts. Com- mission on Cost of Living. Report, Bo-ton, May, 1910, pp. 71-72. Table 1 Family Budgets for the Country as a Whole (National Industrial Conference Board) Localities included Period of time covered Purpose Method of collect- ing infor- mation Families included Percentage of average income received from — Average yearly income Average yearly cost of living Average yearly surplus Average yearly deficit Percentage of cost of living spent for — Investi- Number Method of selection or other qualification Average size Father Mother Children Boarders and lodgers Other sources Food Shelter Cloth- ing Fuel and light. gator Actual Equiv- aJent adult males Sun- drtss United States Bureau of of Labor Statistics Industrial centers in 33 states One year ending in 1900-1902 To meet pub- lic demand for informa- tion House visits by agents 25,440 In proportion to in- dustrial population; wage-workers and others on salarv less than $1,200 annually 4.88a b 79.49 1.47 9.49 7.78 1.77 »749.50 $699.24 $50.26 b b b b b Same Same Same Same Same 2.567 Ability to give de- tailed information regarding expendi- tures 5.3 la b b b b b 6 827.19 768.54 58.65 42.54 \4.53c 14.04 S.2S 23.64 Same Same Same Same Same 11.156 "Normal" families onlyd 3.96 b b b b b b 650.98 617.80 33.18 ... 43.13 18.12 12.95 5.69 20.11 British Board of Trade 29 principal industrial towns east of the Mississippi River 1909 To collect in- formation for international comparisons of conditions affecting, wage-earners e 3.215/ Families of Ameri- can or British ex- traction in north- ern cities 4.9a b e i S e £ b 6 6 I> 53 for food and shelter; 47 for clothing, fuel, light and sun- dries United States Railroad Wage Commis- sion Selected cities in different parts of the country Year 1917 To estimate increased cost of living for purpose of ad lusting wages of rail- way employees News- paper editors 265 b b b b b b b b 1,162.00 1,210.00 $48.00 42 17 15 7 19 United States Bureau of Labor Statistics 92 towns in 42 states One year ending some time between July 31, 1918, and February 28, 1919 To show liv- ing conditions in all sections of the coun- try f Hotts? visits by agents 12,096'" J 4.9 3.33 89.2 b b b b 1,513.29 1,434.36 78.95 38.2 13.4 16.6 5.3 26.4 a Includes boarders, lodgers and servants. b Not given. ^ Includes rent and payment for principal or interest on a mortgage. rf The normal family, for the purposes of this study, is one which has the husband at work; a wife; not more than five children, and none over 14 years of age; no dependent, boarder, lodger or servant; expenditures for rent, fuel, lighting, food, clothing and aundriea. Eighteenth Annual Report of the Commissioner of Labor, op. e "The sources through which the actual particulars were obtained were very varied, it being consid- ered that by this means the risk either of bias or an unbalanced selection would be best avoided." Report of the British Board of Trade, op. cit., p. xxxix. , , , . , ,«_..,,.., / Budgets were collected from 7,616 families but were analyzed by racial groups. The American- British group in northern cities is the largest and results for them are presented in greatest detail. i These facts are given by income groups only. See pp. 55-56 of the present report. h Budgets were also collected from 741 colored families but no information from them is noted here. « The immediate reason for this investigation was to secure information that could be used by the National War Labor Board and its arbitration agencies in the adjustment of wages during the war. j In order to be scheduled, families had to meet the following requirements: they must be those of wage- earners or salaried persons, with a man, wife and at least one child who is not a boarder or lodger, who had kept house in the locality for the entire year covered; at least 75% of the family income must be derived from the principal breadwinner or others who turn their earnings all into the family fund; all items of income and expen- ditures must be obtainable; there must be no boarders and not over three lodgers either outsiders or children living as such; there must be no subrental except furnished rooms for lodgers; slum or charity families or non-English- speaking families who had been in the United States less than five years were excluded. Four investigations which have been made of the cost of living in the United States as a whole are worth noting, be- ginning with the investigation by the United States Bureau of Labor in 1900-1902. Although these contain information for smaller geographical areas or racial groups, only the totals for the country as a whole are reproduced in Table l.i Investigation by the United States Bureau of Labor, 1900-1902 This investigation was made in the years 1900-1902, for the purpose of meeting the continuing popular demand for information regarding the cost of living. It includes an analysis of the incomes and expenditures of 25,440 families in 33 states, and also contains a large amount of data on retail prices of food. The information was collected by agents of the Bureau through personal visits to the families studied. These families were selected without regard to industry, but included wage- earners or clerical workers receiving less than $1,200 a year. The number of families chosen in each locality corresponded very closely to the total number of wage-earners in manufact- uring in that particular section of the country. The data thus collected were analyzed so as to show in detail the membership of the family, the occupation, earnings and non-employment of the head of the family, and incomes and expenditures. The average size of these 25,440 families was 4.88 persons. Families whose head was native born averaged 4.67 persons and foreign families, 5.18 persons. Families were largest in the South Atlantic and South Central States and smallest in the Western States. The average yearly income of these families, from all sources, was $749.50; their average yearly cost of living was $699.24. This means that an average of $50.26 or 6.71% of the total income remained as unexpended surplus. Native- born families had a slightly smaller average income but a slightly larger surplus than foreign families. Among all families, 50.38% had a surplus and 16.18% had a deficit; the remainder came out even.2 ^These studies are arranged in chronological order in the text and are noted by the name of the organization makmg the investigation. The reports of these studies may be found in the following publications: United States Bureau of Labor, 1900-1902: United States. Bureau of Labor. Eight- eenth Annual Report of the Commissioner, "Cost of Living and Retail Prices of Food," Washington, 1903. British Board of Trade, 1909: Great Britain. Board of Trade. "Cost of Living in American Towns." Reprinted as United States. 62nd Congress, ist Session. Senate Document No. 22, Washington, 1911. A summary of this is printed in United States. Bureau of Labor. Bulletin No. 93, March, 1911, pp. S00-SS6. United States Railroad Wage Commission, 1917: United States. Railroad Adminis- tration. Report of the Raiboad Wage Commission to the Director General of Railroads, Washington, April 30, 1918. United States Bureau of Labor Statistics, 1918-1919: Monthly Labor Review, May, 1919, pp. 147-165; ibid., June, 1919. PP. 101-116; ibid., July, 1919, pp. 7S-II4; ibid., August, 1919, pp. I-2S; 117-119: ibid,, September, 1919, pp. 9-30; ibid., November, 1919, pp. 1-19; ibid., December, 1919, pp. 29-41: ibid., January, 1920, pp. 27-34; ibid., July, 1920, pp. i-io; ibid., September, 1920, pp. 83-99- JSome famiUes had a deficit. The figures were: 12,816 families with an average surplus of $120.84 per family: 4,117 families with an average deficit of J65.58; 8,507 families with neither surplus nor deficit. Eighteenth Annual Report of the Commissioner of Labor, op. cit., pp. 68-71. ^' The cost "of living of 2,567 of these families was studiedin detail. The only qualification for selection was their ability to give the necessary information. They were supposed to be in every way representative of the total group. They averaged slightly larger than the total number, however, being 5.31 persons per family; and their income, $827.19, and their costof living, $768.54, were correspondingly greater. These families had an average surplus of income over expenditure amounting to $58.65 for the year.i Their expenditures for the different items in the family budget were: for food, 42.54% of the total; shelter (including rents, and principal and interest invested in buying a house), 14.53%; clothing, 14.04%; fuel and light, 5.25%; sundries, 23.64%.2 Another group of families selected from the total of 25,440 for special study was one of 11,156 so-called "normal" families, i.e., those in which the husband was at work, there was a wife, not more than five children and none over 14 years of age, no dependent, boarder, lodger or servant, and in which there were expenditures for all of the major items in the family budget.^ These families averaged 3.96 persons and their average cost of living was less than that of the other two groups of larger families. The average income of these 11,156 families was $650.98 a year, with an annual average cost of living of $617.80, leaving a yearly surplus of $33.18 or 5.1% of the total income. Expenditures were distributed as follows: for food, 43.13%; shelter, 18.12%; clothing, 12.95%; fuel and light, 5.69%; sundries, 20.1 1%.* The study of the 25,440 families from whom data were col- lected and each of the two subsidiary analyses emphasized certain phases of budget investigations and each has thus a certain advantage over the others. Each is limited, however, in its scope. The size, average income, sources of income, and expenditures of American wage-earners' families in 1900- 1902 are probably best represented by the investigation of 25,440 families. The number studied was so large as to afford a broad basis for generalization. They lived in all sections of the country; they were unselected and included representatives of every size, the great majority, but not all of them, with a husband, wife and one or more children. They included boarders, lodgers, servants, wage-earning children contributing all of their incomes, non-wage-earning children and other de- pendents. A classification of the income in relation to the sources from which it was derived indicates that of the average total income of $749.50, 79.49% was earned by the father, 1.47% by the mother, 9.49% by the children, 7.78% was paid by boarders and lodgers, and 1.77% came from other sources. ^Eighteenth Annual Report of the Commissioner of Labor, op. cit., p. 75. nbid., p. 648. tibid., p. 18. *Ibid., pp. 99. loi, S68. Among families whose heads were born in the United States, slightly more of the average income was contributed by the father and slightly less by the children, while among foreign- born families the reverse was true.i The proportion of families having incomes from each of these sources is given as follows: 95.92% had income from occupation of the father; 8.54% had income from occupation of the mother; 22.19% had income from the children; 23.26% had income from boarders and lodgers; 14.35% had other sources of income. Except that a larger proportion ot foreign families had income from children and from boarders and lodgers, there was very little difference in the sources of income of families with native and families with foreign-born heads. ^ The expenditures of the 2,567 families whose incomes and expenditures were studied in detail are of special interest be- cause of the minuteness of the analysis of the proportions of the income spent for different items in the family budget, par- ticularly the expenditure for food. It is the average expendi- ture for each of the different items in the food budgets of these 2,567 families which the Bureau of Labor Statistics used until January, 1921, as the weight given that item in computing changes in retail prices of food from month to month, between 1890 and 1920. ' The 11,156 "normal" families studied were a special group, selected on the basis of certain qualifications in order that all might be as nearly alike in composition as possible. As such, they do not include families without fathers or mothers, families with more than five children or with any children over 14 years of age, or families where there were boarders or lodgers. Thus, they represent conditions among a selected group of American wage-earners' families, rather than actual conditions among all families. The expenditures of these families were analyzed with reference to size, nativity of the chief wage-earner, geographical location and amount of in- come.* No attempt was made as a result of this study by the Bureau of Labor to establish a minimum standard of living or to de- termine how much was required to maintain what might be regarded as a fair standard. The facts regarding income and expenditure were set forth in great detail and readers were left to draw their own conclusions. So far as the cost of living is concerned, the only way of re- ducing all three studies to a common base is to determine i/Wd., p. 63. Hbid., pp. 49-50. It should be noted that among all children five to i6 years of age, only 4.7% were at work and less than i% of them were at work and in school. The greater part of the income contributed by children must, then, have come from those i6 years of .age or over. Ibid., p. 37. Hhid., pp. 647 ff.; Monthly Labor Renew, March, 1921, pp. 24-27. •Eighteenth Annual Keport of the Commissioner of Labor, op. cit., pp. 90 ff. the average yearly cost per person. This cannot be done with strict accuracy from the data given, since the ages of the persons in the average family in each case may differ and thus affect the cost. It is to be presumed, however, that the average age of the 4.88 persons making up the group of 25,440 families and of the 5.31 persons comprised in the group of 2,567 families would be greater than in the group of 11,156 "normal" families selected so as to exclude all but parents and children under 14 years of age. The average cost per person among all 25,440 families studied was $143.29 a year; that among the 2,567 families, studied in detail as representative of the 25,440, aver- aged $144.73.1 Among the "normal" families, the average cost was, however, higher: $157.13 a year, per person.^ Investigation by the British Board of Trade, 1909 This investigation of the cost of living in American towns was made in 1909 by agents of the British Board otf Trade as a part of a comprehensive survey of conditions of working- class life in the principal industrial countries. In the United States, 29 cities were visited in the East, South and Middle West, including a total population in 1910 of fifteen and one- half million people. Although in this study principal atten- tion was directed to the cost of food and shelter, family budgets were collected and interesting data were assembled regarding the lives of American wage-earners. A variety of agencies was used in collecting these budgets and the effort was made so far as possible to avoid bias or an unbalanced selection. Twenty-eight different nationalities were represented among 7,616 families, of whom 42.2% were American, English, Irish, Scotch, Welsh and Canadian. A brief summary of the findings regarding this group, numbering 3,215 families, will undoubtedly represent as high a standard of living as prevailed among any of the families studied and will be sufficiently indicative of the findings for the present purpose. The cost of living of these families is not given and data regarding amount of income are so divided among different income groups as to make generalizations unsatisfactory. However, nearly one-third of the 3,215 families had weekly incomes averaging between $14.60 and $19.47; nearly another third had between $19.47 and $29.20; 18.6% had less than $14.60 and the remainder had $29.20 or more.^ Some of the most interesting evidence brought out by this study was with reference to the size and composition of the family. It was shown that: (1) among all families, the aver- ^These figures are obtained by dividing the average cost of living per family by the average number of persons in the family. ^Eighteenth Annual Report of the Conunissioner of Labor, op, cii., p. S9i. 'Bureau of Labor Bulletin No. 93, op. cit,, p. S39. The income in pounds sterling is shown in Report of the British Board of Trade, of. «(., j}. XLV. age size was 4.9 persons including boarders and lodgers ;i (2) about one-third of these latter were in reality older children living at home and paying board ;2 (3) children living at home and not rated as boarders and lodgers averaged 2.8 per family;^ (4) the largest families were in the largest income groups and vice versa.^ The average proportion of the income spent for food and shelter combined, by all of these 3,215 families, was slightly more than 53%, leaving a little less than 47% for all other items.^ The chief significance of this study for the present purpose lies in its confirmation of the findings of other investigators at certain points, but particularly in the light which it throws on sources of income among wage-earners' families. This is noted in detail on pages 55 to 57 of the present report. Although the actual cost of living of these families is not given, nor the standard at which they lived, internal evidence indicates that they are representative of the better type of American wage- earners. Investigation by the United States Railroad Wage Commission, 1917 In January, 1918, the United States Director General of Railroads appointed a commission to make an investigation of the hours, wages and cost of living of railroad employees in different sections of the country. As a part of this study bud- gets were collected from 265 families of^ working people. The precise method of collecting these budgets is not described, but the report of the Commission states, " This study of the cost of living was not made from paper statistics exclusively, by the gathering of prices and comparisons of theoretical budgets. It was in no inconsiderable part a study from actual life, one of the most interesting and valuable groups of figures having been gathered by the newspapers of the country, by interviews with those of the working class, and the inspection of their simple books of accounts."" The statistical experts from the Census Bureau, who tabulated and analyzed the results, state that the latter "are at best nothing more than a composite of careful guesses, as very few families keep trustworthy records.'" Budgets giving in detail family incomes and expenses for the years 1915 and 1917 were collected between January and *Out of a total of 15,824 persons in these families, only 466 were other relatives and boarders sharing the family food. Report of the British Board of Trade, oi. cil., p. XLV. nUd.i p. XLVI. Hhii., p. XLVII. nUi., p. XLVI. See also p. SS of the present report. 'Report of the British Board of Trade, ot- cit., p. XLIX. •Report of the Railroad Wage Commission, op. cit., p. i5. ilbid., p. 89. March, 1918. The average size of these 265 families is not given, nor is there any report on sources of income. Their average cost of Hving was $1,210 in 1917;i their average income was $1,162. Thus there was left an average deficit of $48 per family. This deficit was distributed among 140 families; 96 had a surplus. 2 The average expenditures of these 265 fami- lies in 1917 were apportioned among the different budget items as follows: food, 42%; shelter, 17%; clothing, 15%; fuel and light, 7%; sundries, 19%.^ The data given are in all cases analyzed for each of the three territorial divisions of the country as organized by the_ Inter- state Commerce Commission, and are also given by income groups. In the territorial divisions there is shown for each income group a somewhat lower cost of living in the western territory than in the eastern, with the southern almost midway between. The difference between the three, however, is not great.* This survey of the cost of living was made very rapidly for a specific purpose and adds very little to the general body of budgetary information. It apparently confirms existing knowl- edge regarding distribution of expenditures, and the fact that there was an average deficit in 1917 as contrasted with the frequently found surplus of income over expenditure may be due to a greater increase in the cost of living than in income, or it may be due to inadequacies of enumeration. The in- vestigation was too hastily made and the results were too in- completely analyzed to warrant any final conclusions from them. Investigation by the United States Bureau of Labor Statistics, 1918-1919' War problems prompted this investigation. Studies of the cost of living in 35 communities on the Atlantic and Pacific Coasts, the Gulf of Mexico and the Great Lakes had already been made in 1917 and 1918, by the Bureau of Labor Statistics in cooperation with the Shipbuilding Labor Adjustment Board of the Emergency Fleet Corporation for the purpose of secur- ing a basis of adjusting wages of shipyard workers." The next year, in cooperation with the National War Labor Board, a more extensive study was made, including some of these cities and also other types of industrial and non-industrial centers. The cost of living in 92 communities was investigated. ^Figures for 191S are also given, but as they were collected two years later, it is thought those for 1917 will be more accurate. ^Report of the Railroad Wage Commission, op. cit., p. 89. 'Ibid., p. 91. *Ibid., p. 89. ^A complete report of this investigation has not yet been printed; sections of it have appeared at intervals in the Monthly Labor Review, beginning m May, 1919. "Reports of these investigations were printed in successive numbers of the Monthly Labor Review, beginning in March, 1918. A summary of the findings as regards s,ooo white famiUes is printed in Appendix A of the present report. 10 The results of this study are given for each locality separately and for all combined for 12,096 white families and 741 colored families. In the present analysis, only white families have been considered. These families were definitely selected to meet certain re- quirements. Thus, in order to be scheduled: "1. The family must be that of a wage-earner or salaried worker, but not of a person in business for himself. The families taken should represent proportionally the wage- earners and the low or medium salaried families of the local- ity. 2. The family must have as a minimum a husband and wife and at least one child who is not a boarder or lodger. 3. The family must have kept house in the locality for the entire year covered. 4. At least 75% of the family income must come from the principal breadwinner or others who contribute all earnings to the family fund. 5. All items of income or expenditure of members other than those living as lodgers must be obtainable. 6. The family may not have boarders nor over three lodgers either outsiders or children living as such. 7. The family must have no sub- rental other than furnished rooms for lodgers. 8. Slum or charity families or non-English speaking families who have been less than five years in the United States should not be taken. "Requirement 6 has been construed not to refer to or in- clude relatives, servants, nurses, etc., temporarily in the home, who were furnished board free."i Thus, families with older children at work were not included unless the children turned all of their earnings into the family fund, and boarders as a source of income were excluded. This choice of families necessarily imposes limitations on the results which must, therefore, be regarded as referring to a selected, rather than to a representative group. This study was made to cover expenditures for a year ending some time between July 31, 1918, and February 28, 1919. Schedules were filled out in great detail by agents who called on housewives and obtained their figures and estimates of ex- penditures for the preceding year. The combined figures show that these 12,096 families averaged 4.9 persons and that their average income for the year under consideration was $1,513.29.2 Of this income, 89.2% was contributed by the father of the family but no conclusion regarding all wage-earners' families can be drawn from this fact because of the method of selecting those chosen for study. It appears, however, that, picked though they were to minimize sources of income other than that contributed by the father, 8.9% of the famihes had an income from earnings of the wife, 18.6% from earnings of children, 0.7% from earnings of other dependents, 5.1% had lodgers, 44.3% had income from garden and poultry, 73.3% had gifts, 11.2% had income from rents and other investments and 28.4% had other sources of income.s ^Monthly Labor Review, May, 1919. P- I47- Hbid., August, 1919, p. 118; ibid., December, 1919, p. 39. 'Ibid., December, 1919, PP- 34.3S- 11 The average cost of living of these families was $1,434.36 for the year. A surplus was reported by 8,496 families, aver- aging $155.26 for the year; 2,866 families reported an average deficit of $127.03 and 734 families had neither surplus iior deficit. The entire group had an average surplus per family of $78.95. Expenditures for the separate items were as fol- lows: food, 38.2% of the total; shelter, 13.4%; clothing, 16.6%; fuel and light, 5.3%; furniture and furnishings, 5.1%; miscel- laneous, 21.3%.i A wide variety of community types were included in this investigation and all sections of the country were represented. ^ While there is a great difference in the cost of living in the different localities, ranging from $1,919.40 for the year ending some time between September 30, 1918, and February 28, 1919, in Bisbee, Ariz., to $1,167.12 annually in the year ending some- time between August 31, 1918, and February 28, 1919, in Chippewa Falls, Wis., for families of about the same size, there is apparently no general conclusion to be drawn regarding location per se as a factor in differences in the cost of living. Cities of every size, in every section of the country are in each expenditure group, and to make possible any statement re- garding factors particularly influencing the cost of living in specific communities, much more would have to be known than the reports tell regarding local industrial and social con- ditions. Due to their method of selection, families averaged about the same size and composition in all localities. With the exception of Knoxville, Tenn., an average surplus was every- where reported, although there were in each locality some families which had a deficit. Conclusion These four studies of family budgets for the country as a whole throw light on the average size of American wage- earners' families, on their sources of income, and on the manner in which this income is spent. The principal findings on these points, together with such conclusions as it seems legitimate to draw from them, are discussed in Chapters IV and V of the present report. Although information is given regarding the amount of income among the families surveyed and their cost of living, no attempt was made in any of these investigations to formu- late a standard of living or to estimate the cost of maintaining it. Only averages of conditions actually prevailing are pre- sented. The study by the United States Bureau of Labor Statistics in 1918-1919 is of selected groups of families; the results must, therefore, be used with caution. ^Monthly Labor Review, August, igig, p. iiS. Hhid., May, 1919, pp. 147-165; ibid., June, 1919, pp. 101-116; ibid., July, 1919, pp. 7S-114. For each locality separately, see Appendix B of the present report. 12 II LOCAL STUDIES OF FAMILY BUDGETS The investigation of family budgets noted in the preceding chapter recorded in some detail the incomes and expenditures of large groups of families in all sections of the country. The figures, obtained by persons unknown to the families, were averaged and the conclusions reached were based on these data. They show only what real families were actually re- ceiving and actually spending, without comment on any phase of their household economy. A more intimate analysis of the standard of living among American workingmen's families is supplied by a series of studies of conditions in smaller areas or among special groups in a given locality. While studies of the latter type lack a certain breadth of statistical basis, they are frequently rich in intimate detail which makes possible a more complete un- derstanding of the household economy of wage-earners' families than does a bare analysis of statistical data. The most significant feature of these local studies lies, how- ever, in the fact that, in addition to supplying information regarding the actual cost of living, they also established the cost of maintaining what was thought to be a fair minimum standard. The cost thus determined does not represent an average of what families actually were spending, although this frequently is given, but it is rather the investigator's estimate of the least possible amount required by a family to maintain a fair standard of living. In Table 2 are summarized the more important of these local studies. Their purposes were varied and the methods of making them also differed. The investigations by More, Chapin, Howard, Byington, the United States Bureau of Labor in the cotton textile centers, Kennedy, and Little and Cotton were intensive studies made as matters of sociological interest, to obtain an insight into the general standard and cost of living among the groups which they studied. The investigation in New York City and in Buffalo made by the New York State Factory Investigating Commission, that in the District of Columbia made by the United States Bureau of Labor Statistics, and that in Dallas made by the Dallas Wage Commission were undertaken for the purpose of determining the cost of living among wage-earners more or less definitely 13 in relation to wages in those particular cities; the study by the Philadelphia Bureau of Municipal Research was made in order to ascertain the quantitative content of a fair standard of living and its cost, with reference especially to the requirements of city employees. 1 New York City, 1903-19052 Mrs. More's study was made by residents of a lower west side settlement house in New York in 1903-1905, for the pur- pose of collecting data on incomes and the cost of living, which should do for American wage-earners what the studies of LePlay,3 Engel,* Booth,' and Rowntree" had done for the workers of Europe, i.e., give a cross-section picture of their lives in their daily social, economic and industrial relations. This was far more than a study of the cost of living and the investigators collected much information in addition to purely statistical data. Two hundred families were chosen, the only qualification for selection being their willingness and ability to cooperate. Through the encouragement of the investigators, records of income and expenditure for a year were kept by many of these families. Careful estimates were made for others. The facts were then tabulated, analyzed and interpreted in the light of the investigator's intimate personal knowledge of the fam- ihes. Such a study as this, therefore, while limited as to num- *These studies are arranged in chronological order and are noted in the text by name of the locality where they were made, The reports may be found in the following publications : New York City, 190S-190B: More, Louise Bolard. "Wage-Earners' Budgets." New York, 1907. New York City, 3907: Chapin, Robert Coit. "The Standard of Living Among Workingmen's Families in New York City." New York, 1909. Buffalo, N. Y., 1908: Chapin, ot- cit.. pp. 307-318. Homestead, 1907-1908: Bymgton, Margaret F. "Homestead: The Households of a Mill Town." New York, 1910. Three Southern Cotton Mill Communities, 1908: United States. Bureau of Labor. Report on Condition of Woman and Child Wage-Earners in the United States. Vol. XVI, "Family Budgets of Typical Cotton Mill Workers." 6ist Congress. 2nd Session. Senate Document No. 645, Washington, 191 1. Fall River, Mass., 1908: Report on Condition of Woman and Child Wage-Earners in the United States, op. cit.. Vol. XVI, pp. 173-250. Chicago, III., 1909-1910: Kennedy. J. C. and others. "Wages and Family Budgets in the Chicago Stockyards District." Chicago, 1914. New York City, 191 4: S+ate of New York. Factory Investigating Commission. Fourth Report, Albany. 1914, Vol. IV, pp. 1465-1473; 1625-1671; 1785-1813. Buffalo, N. Y., 1914: Fourth Report of the New York State Factory Investigating Commission, op. cit., pp. 1473; 1625-1671; 1813-1824. Philadelphia, Pa., 1913-1916: Little. Esther Louise, and Cotton, William Joseph Henry. "Budgets of Families and Individuals in Kensington, Philadelphia," Lan- caster, 1920. District of Columbia, 1916: United States. Bureau of Labor Statistics. "Cost of Living in the District of Columbia." Monthly Review of the U. S. Bureau of Labor Statistics, October, 1917; ibid., November, 1917; ibid., December, 1917. Dallas, Tex., 1917: Dallas Wage Commission. Report of the Survey Committee. Dallas, 1917. Philadelphia, Pa., 1916-1918: Bureau of Municipal Research of Philadelphia, "Work- men's standard of Living in Philadelphia," New York, 1919. 'This investigation was made under the auspices 'of the Greenwich House Com- mittee on Social Investigations. 'LePlay, Frederic, "Les Ouvriers Europeens," Paris, 1855; 1877-1879. » / Same Fall River 1908 Same Same 14 To represent New Eng- land : '*-in textile com- munis 6.21 a a a a a a a a a a a a a a a m m m m m $731,640 J. C. Kennedy and others Chicago (stockyards district) 1909-1910 To determine the least wage which will sup- port a family of 5-8 -persons decently House visits, cash ac- counts, intimate ac- quaintance with the families 184 In proportion to racial and income distribution of families in the dis- trict 5.33P a 54.4 24.65 6.4 10.7 3.9 92.4 11.4 28.2 50.0 22.8 $854.13 $823.98 $30.15 53.6 13. 2r U-6 4.1 17.5 $800.00 New York State Factory Investiga- gating Commission New York City 1914 To inquire into the de- sirability of a minimum wage law House visits; collection of prices 34 With incomes between $12 and $20 weekly, where the mother was not gainfully employed a a a a a a a a a a a a a a a a a a o a $876.43 Same Buffalo 1914 Same Same 18 Same a a a a a a a a a a a a a a a a a a a a a $772.43 E. L. Little and W. J. H. Cotton Philadelphia (Kensington district) 1913-1915 To establish the stand- ard and cost of living in this district Intensive study by per- sons known to the families, account books, collection of prices 23 Families personally known to the investiga- tors 5.2J a a a a a a a a a a a a a a a a a a a $1,069.94 United States Bureau of Labor Statistics District of Columbia 1916 To ascertain for Con- gress the cost of living among wage-earners Special agents col- lected family incomes and expenditures from house-wives 1,481 u 3.8" VI a a a a a 88.4 11.2 14. Sy 51.0 46.7 $1,231-44 $1,216.03 $15.14 40.7 2S.yx 9.8 X 23.8 a Dallas Wage Com- mission Dallas 1917 To obtain a basis for wage increases to city employees Families kept accounts for 30 days, collection of prices 50 Not stated. Families included those of 29 city employees and 21 factory employees 4.8 a 84.60 3.19 5.36 t 6.853 a a a a a $962.83 $1,134.55 $171.72 45.01 14.51 12.57 9.11aa 18.80aa $1,081.72 Philadelphia Bureau . of Municipal Research Philadelphia 1916-1918 To obtain the quanti- tative content of a fair standard of living with reference especially to city employees, and its cost House visits, cash ac- counts, collection of prices 260 Self-supporting, where chief bread-winner earned not more than $2, DOC an- nually, and there ^/ere children ur^d-^ 14 years of age 5.04** cc 84.8 3. Odd 6.3 5.9 dd 100.0 11.5 19,6 34.6 34.6 $1,262.09 $1,261.93 .16 44.1 14.1 13.9 5.1 22.8 $1,636.79M <» Not given. * This represents the minimum of a "fair living wage"; allowing for a somewhat larger surplus to provide adequately for the future was said to require $800 to $900 a year. c According to the unrevised Atwater scale which differs slightly from that of the United States Bureau of Labor Statistics. d Given by income groups only. « The information is given as follows: families where the father was the only source of income, 46.8%; families with earnings of others, 27%; families with lodgers, 29.2%; Chapin, 0*. cj^. p. 64. / This is the estimate of the New York State Conference of Charities and Corrections for which the investigation was made. Chapin himself was less definite. See Chapin, op. cit., pp. 230; 246-7. 8 Other sources of income are included with that contributed by the children. h Exclusive of lodgers; with lodgers these families averaged 5 persons. •' This information is arranged by racial groups but is not summarized. , J In 59% of these families the father was the only wage-earner; in 10% the mother contributed; in 19% sons contributed and 20% had income < The average weekly expenditures of the $15 to $19.99 group was $17.59 which was considered the mininwm weekly cost of living. The sise of family I Exclusive of boarders; with boarders and lodgers these families averaged 8.5 persons in the southern mill towns; 6.8 in Fall River. »» Given for each family separately but not summarized. » This is the estimated cost of maintaining a "fair" standard; the minimum standard, at bare subsidence, is estimated to cost $408.26. o This is a fair standard for Eiyljsh, Irish and French Canadian families; for Portuguese, Polish and Italian families the maintenance of a fair standard was estimated to cost $690.60 a year, and the bare subsistence standard for all nationalities was placed at $484.41. ">.»""»iu P Exclusive of boarders or lodgers; these averaged, 1.9 per family. Q Includes the mother and all others who contribute except children under 16. f Includes only 131 families who paid rent. ' Includes boarders and lodgers. ' These are white families only; data were also collected and analyzed for 629 colored families. . ,. . " Families were those where the principal breadwinner was a wage-earner or, if a salaried person, earned not more than $1,800 a year. All aeetltnu or tna city were covered. ' ' Exclusive of boarders and lodgers; with boarders and lodgers the average size was 4.9 persons. " Those who consumed food averaged 3.71 adult males but this includes boarders. * Rent includes outlay for fuel and light. y Includes 204 children and 1 1 other relatives at work. 2 Income from boarders and lodgers included in other sources. in" ^'S^^"^ j**'°" *'™" " 9.n% for maintenance and operation, 5.29% for medical, 5.06% for insurance, church, charity and recreation; 8.45% for cai^ 6* "Net family;" "household," including boarders and lodgers, averaged 5.57 persons per family. ce Those who consumed food averaged 3.79 persons per family, but this included boarders. ad Earnings of the mother, other members of the family and from other sources are combined. ee This estimate was made six months later than the last date on which budgets were collected. bers, has the advantage of close acquaintance with the families on the part of the investigator which is necessarily lacking in a mere census taker. These families were considered by the investigator to be entirely representative of the district studied. They were not selected for size or race or occupation. No arbitrary limits were set as to income, and as many families as possible above the so-called "dependent class" were included. They were composed of fathers and mothers, boarders, children at work, minor children and other dependents. The average size of the families was 5.6 persons; the ages of the children were not specified. The average annual family income for the year studied was ?851.38; their average annual cost of living was 2836.25. This meant a surplus of $15.13 yearly. Some families, of course, had a larger surplus than this; among a smaller number there was a deficit, i The average income was made up of contributions from all sources and did not represent the wages of the head of the family alone. Among these 200 families there were only 23 in which earnings of the husband were reported as the sole source of income. 2 Of all families, 85.5% had income from the hus- band; 46.5% had income from the wife; 37% had income from the children; 31% had income from boarders and lodgers; and 58.5% had other sources of income.' Of the total average income among these families, 63.5% was derived from labor of the husband; 9.4% from the wife; 11.5% from the children; 9.2% from boarders and lodgers; 6.4% from other sources." In addition to studying incomes and expenditures, Mrs. More and her collaborators made very careful note of the stand- ard at which the families she investigated were living, of their diet, their clothing, their housing. On this basis, as well as from the statistical data collected, she established what she considered to be the minimum cost of living at that time in New York City. This, she believed, "should be large enough not only to cover expenses which Mr. Rowntree calls 'neces- sary for maintaining merely physical efficiency,' but it should allow for some recreation and a few pleasures, for sickness, short periods of unemployment, and some provision for the future in the form of savings, insurance or membership in benefit societies." The cost of maintaining a fair standard "depends primarily on the amount and cost of food necessary for proper nutrition. . . . This investigation has shown that a well-nourished family of five in a city neighborhood needed at least $6 a week for food. ... If we consider $6 a week (or $313 a year) as 43.4% of the total expenditure (which was the average percentage expended for food in these 200 families, •More, op. cil., p. SS- Hbid., p. 88. 'Ibid., p. 84. Ubid., p. 83. IS and very near the average for the workingmen's families in the extensive investigation of the Department of Labor), the total expenditure would be $720 a year. It therefore seems a conservative conclusion to draw from this study that a 'fair living wage' for a workingman's family of average size in New York City should be at least %11% a year, or a steady income of $14 a week. Making allowance for a larger propor- tion of surplus than was found in these families, which is neces- sary to provide adequately for the future, the income should be somewhat larger than this — that is, frorn $800 to $900 a year."i The average income of these 200 families studied was $851.38 a year, but they averaged slightly in excess of five persons. New York City, 1907 This investigation of the standard and cost of living among wage-earners' families in the city of New York was made in 1907 for the New York State Conference of Charities and Corrections. It grew out of a desire on the part of social workers in the state to know the exact content of a normal standard of living and how much the maintenance of this standard would cost. Schedules were filled out by settlement and other social workers, by trade union members and by paid investigators. Families in which both parents were living, in which there were from two to four children under 16 years of age and which had incomes between $500 and $1,000 a year were the type chosen. When the schedules were completed, the majority were found to be for families with incomes between $600 and $1,100 annually. Data were tabulated for families of four, five or six persons; the average size was five and the majority of the families fell within the specified income groups.^ The analysis of the data collected for this investigation was made in great detail, sometimes in too great detail to avoid the possibility of error if conclusions are drawn from the figures, because of the few cases in each of the subdivisions studied. Thus, for example, analyses were made by nationality as well as by income groups. The $600 to $699 income group is made up of 72 families subdivided as follows: United States, 11; Teutonic, 4; Irish, 4; Colored, 11; Bohemian, 4; Russian, 16; Austrian, etc., 6; Italian, 16. Other income groups show racial subdivisions as small or smaller than these.' Sub- divisions along other lines also frequently contained very few cases in any one group.* In so far as the problems connected with the cost and stand- ard of living are concerned, nowhere are the facts brought *More, op. cit., pp. 269-270. Italics appear in the original. 'Chapin, of. cii., pp. 37-38. 'Ibid., p. 64. *See, for example, ibid., p. 63. 16 together for all of the 391 families;i nowhere is there an average income or an average cost of living given, except for income groups. Thus, the average income and the average cost of living of all of these families combined are not to be found. On the other hand, great care was taken to study and estab- lish standards and, on the basis of the possibility of maintain- ing these standards for a given amount, the probable minimum cost of living was estimated. The committee under whose direction the investigation was made, of which Lee K. Frankel was chairman, concluded that in the borough of Manhattan, "$825 is sufficient for the average family of 5 individuals, comprising the father, mother and 3 children under 14 years of age to maintain a fairly proper standard of living.''^ It would cost slightly less than this in the other boroughs because of lower rents. R. C. Chapin, who directed the investigation and made the final report, stated "a comfortable margin of income over expenditure is first possible with an income be- tween $800 and $900."^ The average income of this group of 73 families was $846.26; their average cost of living was $811.88 Chapin noted, however, that "the standard set by the nations of Southern Europe can be attained on $800 much more cer- tainly than the American standard."^ He was more inclined to accept $900 to $1,000 a year as the sum required by five persons to maintain a fair American standard of living in New York City in 1907.5 Among the families studied by Chapin, selected though they were, in only 46.8% of the cases were the wages of the father the only source pf income. Twenty-seven per cent of the families had incomes from the earnings of others, such as wife or children, and 29.2% had income from lodgers. Figures showing the proportion of the total income contributed by the father and by other wage-earners, the proportion derived from boarders and lodgers and that from other sources are presented by family income groups and by nationality." The chief value of this study, also its chief weakness, lies in the minute detail with which the analysis of the data was made. As a comparison of the standards and cost of living of selected groups of families the picture is of great interest and usefulness, provided the numbers studied are not too small to justify the general conclusions which have been drawn. It should always be borne in mind, however, that this is a study of families selected as to size and age and income, the great majority of whom lived in the borough of Manhattan of the city of New York. That conditions here are not representative of condi- lExcept Howard's combination of expenditures to show the average proportion of the total spent for each of the separate items in the budget. Chapin, op. cil., p. 314. *Ibid., p. 281. »/6«d., p. 230. Hbid., p. 230. 'Ibid., pp. 24s ff. 'Ibid., pp. 63-64. 17 tions in other sections of the city is noted in the report. i How they differ from conditions in Buffalo is shown by a comparison with the study made the following year by John R. Howard, for the same purpose and by the same method. Buffalo, 1908 After Chapin had made his study of the standard and cost of living in New York City, Howard made for the same committee of the State Conference of Charities and Corrections a similar study of 100 families in Buffalo. The same schedule was used and the final results were believed to be in every way comparable with the findings of the New York City study. Families in Buffalo were limited to include those with annual incomes not exceeding $700, since this was generally consid- ered to be ample in Buffalo. Not being selected for size, they averaged six persons, which was larger than the families in New York City who were especially chosen so as to average five persons. The nationalities included were also different. It is significant of the care with which the study was made that both income limits and nationalities were selected so as to represent Buffalo conditions rather than adhering to the stand- ard previously established for the city of New York. The average annual income of these 100 families was ?600 and their average annual cost of living was $632. "This dis- crepancy, however, seems to have been due more to hard times than to permanent inability to make ends meet. "2 Nevertheless, there were certain shortcomings in the standard maintained by the Buffalo families for $632 a year which made the investigator believe that to be comparable with the standard established as desirable in New York City, $675 annually would be required as the minimum cost of living in Buffalo. The chief reasons for the difference in cost between the two cities were the higher average rents and the slightly greater cost of food in New York City than in Buffalo. ' While the Buffalo families averaged six persons as against the New York families which averaged only five, their food consumption equaled that of 3.8 adult males in Buffalo as against 3.5 adult males in New York. Homestead, 1907-1908 This study of Homestead was made as a part of the Pitts- burgh Survey of social and industrial conditions among the steel workers in 1907-1908. The statistical data which were collected in this suburb of Pittsburgh were supplemented by ^Chapin, op. cit., pp. 7S ff.; 281. 'Jbid., p. 308. 'This difference between the standard and cost of living in New York City and in other towns is brought out also in other investigations. See pp. 25-26; 87 ff. of the present report. 18 an intensive study of the individual households. The report thus gives a picture of the home life of Homestead rather than a complete analysis of family budgets. Ninety families in Homestead kept a detailed record of their expenditures during a period of four to eight weeks. The families were unselected except for their willingness and ability to cooperate. The data thus assembled were classified ac- cording to the race and according to the income of the famihes reporting. They were not combined for the purpose of draw- ing general conclusions, however, except as regards the size of the family and the sources of the income. The former averaged 4.4 persons exclusive of lodgers. If lodgers are in- cluded, the family average was exactly five persons. Size ot family is not given in relation to income and there seems to have been little relation between size of family and average weekly expenditures.! Ages of members of the families are not given. In 59% of the families studied, the father's earnings were the sole source of income; 20% had income from lodgers; in 19% sons contributed, and in 10% the wife contributed. Among the Slavs, 87% of the average income came from the man, 6.8% from lodgers, 3.7% was contributed by the sons and 2.5% by the wife. Among the colored families, 74% of the income was earned by the man, 12% by the wife, 7.3% by the sons and 6.7% came from lodgers. Among the English- speaking Europeans, 79.9% of the income came from the man, 18.8% from the sons and 1.3% from lodgers. In this last group of families, the mother was in no case employed outside the home. 2 The native white families derived 82.7% of their income from the man, 9.6% from the sons, 1.5% from lodgers, 1% from the wife and 5.2% from the proceeds of a recently sold store on which one family was living.^ Although part of this investigation was made during the industrial depression of 1907-1908, the author of the report believed this had, for various reasons, little effect on the main purpose of the investigation." The average weekly income and average weekly expenditures of these families during the period under consideration are shown in the table below, by racial groups.^ 'Byington, op. cit., p. 2or. The figure shown for the average family is o.s persons; correspondence with the author reveals that the correct figure is five, as given above in the text. 2This agrees with Chapin's study which showed that more Irish families received all of their income from earnings of the father than any other racial group. Chapin, op. cit., p. 63. 'Byington, op. cit., p. 201. Hbid., pp. 43-44- Hbid., pp. 68; 201. 19 Racial group Number of families Average weekly — Income Expenditure Slav . 29 23 13 25 $13.88 17.92 20.53 22.93 $13.09 Colored 12.39 English-speaking Europeans 16.97 20.47 The final conclusion regarding the cost of living among steel workers in Homestead in 1908 is summarized as follows: " We find, that is, so far as this group of 90 family budgets can show us and at the range of prices current in Homestead, that only when earnings are $15 a week, or more, can we con- fidently look for a reasonable margin above the requisite ex- penditures for necessities. It is only in the group spending more than $20 that we find that the average family has reached a point where, without being spendthrift of the future and with- out undue pinching in other directions, they can spend enough to satisfy what we should recognize as the reasonable ambi- tions of an American who puts life into his work."i The average expenditures per week of the group earning $15, but under $20 was $17.59.2 If this weekly cost was a fair average for the year, the necessary annual cost of living would be $914.68. The size of family to which this minimum is to apply is not given, but among the families in the income group $15 to $19.99 weekly, there were 4.4 persons exclusive of lodgers; with lodgers the families averaged 5.3 persons.' Three Southern Cotton Mill Communities, 1908 This investigation was a part of the general study of the condition of woman and child wage-earners in the cotton in- dustry in the United States made by the United States Bureau of Labor in 1907-1908. Its purpose was to throw light on the family economy of cotton mill operatives, as a complement to the study of wages and working conditions. For this reason a few families were studied intensively by agents of the Bureau and from this study deductions were drawn regarding southern cotton mill operatives as a class. The investigation was made in the period January to June, 1909, but the information collected regarding the standard and cost of living refers, for the most part, to the calendar year 1908. The families of cotton mill operatives were found to be large, and were supported by the earnings of several wage-earners as ^Byington, op. cit., pp. 10S-106. 'Ibid., p. 104. 'Ibid., p. 201. 20 well as by income from boarders and lodgers. The average size of the families, exclusive of boarders and lodgers, was seven persons and there was an average of 3.6 wage-earners per family. 1 The distinctive characteristic of this investigation is that each family was studied by itself as a unit, somewhat after the LePlay method. 2 Nowhere are incomes or expenditures among the 21 families averaged, but on the basis of the study of the separate families, estimates were made as to the minimum cost of each item entering into the cost of living and of all iterns combined. The cost of a minimum and of a fair standard of living for a so-called normal family of five persons was then determined. Data are given also for computing the cost of maintaining larger or smaller families, of varying age and sex composition. The minimum budget for a family of five, which provided only for the bare necessaries of life, making no allowance whatever for the cultural wants, was estimated at $408.26 a year.' A "fair standard" was estimated to cost $600.74 s. year.'' These estimates were not theoretical except as regards the size of family but, on the contrary, they were designed to de- scribe conditions as they actually existed. The fair standard was one which could be attained by southern cotton mill families with the means at hand. It is particularly pointed out, how- ever, that the incomes of cotton mill families are made up of the earnings of several workers and that "the so-called normal family — father, with wife and children dependent on him for support, is not a normal cotton mill family. Indeed, this type of family is rare. . . .'" Fall River, 1908 This is a part of the investigation just described and was made in the same way, for the purpose of establishing the standard and cost of living in a New England cotton mill community. Fourteen families of various representative nationalities were studied in Fall River. These, too, were large, as they had been in the South, and there was in every instance more than one source of income, mostly from the employment of the wife and older children. The families averaged 6.2 persons, ex- clusive of boarders and lodgers; of these, 3.12 persons were wage-earners.' 'Report on Condition of Woman and Child Wage-Earners, op. cit„ Vol. XVI, pp. 23, 32. This is in very close agreement with the results of a study of 1,567 cotton mill families in six southern states made the year before, of which the average size was 6.6 persons, with an average of 3.8 wage-earners per family. Ibid., Vol. I, p. 414. ^Frederic LePlajr selected families which he believed to be representative of a large group and studied intensively the standard and cost of living of each as a separate unit. ^Report on Condition of Woman and Child Wage-Earners, op. cit., Vol. XVI, p. 142. 'Ibid., Vol. XVI, p. 152. 'Ibid., Vol. XVI, p. 153. 'Ibid., Vol. XVI, pp. 176, 184. 21 From the intensive study of these 14 families, a minimum and a fair standard of living was established and its cost was ascertained in Fall River. The minimum, as in the South, was designed to maintain physical efficiency only and provided for a standard so little above the level of poverty as to have slight significance in a study of normal conditions. This minimum standard was estimated to cost $484.41 a year for a family of five in Fall River in 1908. The "fair standard" allowed for a small degree of satisfaction of the cultural wants, and was estimated to cost $731.64 for English, Irish and French Canadian families, and $690.60 for Portugese, Polish and Italian families. It was pointed out, however, that in Fall River as in the southern textile centers, a family of five such as that to which this standard applied was merely a convenient measur- ing unit and had no basis in fact. Chicago, 1909-1910 As a part of a study of the Chicago stockyards district by the University of Chicago Settlement in 1909-1910, an investigation was made of wages and family budgets. Families in this neighborhood were known to be almost entirely foreign, and predominantly of Slavic stock. The budgets studied included those of 88 Polish famihes, 68 Lithuanian and 28 of other races; only five of the latter were native-born Americans. The families studied were thought to represent very fairly both the racial and the income distribution of all families in the com- munity. The average size of these 184 families was 5.33 persons, exclusive of boarders and lodgers; the latter averaged 1.9 per family. In only 51% of the families was the father the the sole wage-earner, although in 92.4% of the cases there was a father at work. In 28.2% of them, children of 14 and 15 years of age were at work; in 11.4% of the families, the wife worked. Fifty per cent of the families had boarders and lodgers, and 22.8% had other sources of income. Or, among all families, 54.4% of the average income was contri- buted by the father, 6.4% by the children 14 and 15 years of age, 24.6% by other members of the family, including the mother, 10.7% came from boarders and lodgers and 3.9% from other sources.! The average annual income of these 184 families was $854.13; their average annual cost of living was $823.98. This left an average annual surplus of $30.15. Among 56 families, however, there was a deficit, which, in some cases ran into hundreds of dollars. 2 These families spent 53.6% of their total budget for food. ^Kennedy, op. cit., p. 63 ff. 'Ibid., p. 74. 22 13.2% for rent, 11.6% for clothing and 4.1% for fuel and light, which left 17.5% for sundries.^ An attempt to determine from these budgets what was "the minimum amount necessary to support a family . . . decently in the stockyards district" produced the estimate that at prices prevailing in 1910, $800 was the least amount on which a family of five could "live decently and efficiently." The composition of this family of five was not given. Families could spend more than the amount suggested, without in- dulging in luxuries, but $800 was thought to be the minimum below which families of this size could not be expected to live without giving up the necessities. This budget, however, allowed 22% of the total for sundries, in addition to food, shelter, clothing, fuel and light, and thus provided for considerably more than mere physical existence. ^ Philadelphia, 1913-1914 This is an intensive study of individual families, similar to that of cotton mill employees' families made by the United States Bureau of Labor in the South and in Fall River in 1908.' Budgets of 23 families of mill workers in the Kensington sec- tion of Philadelphia were collected and analyzed. All of the families were known personally to the investigators, which fact, taken in connection with the detailed accounts of in- comes and expenditures which were kept by the families, in several instances for an entire year, would seem to make for an accurate portrayal of living conditions in this district. The accounts were not averaged, however, and the fact that they were kept for different periods of time makes it impossible to average some of the items. After presenting in detail the budgets of these 23 families, an attempt was made to determine the cost of maintaining a fair standard of living in the district. Of this, it is said, "an effort has been made to include in the standard, for the most part, only those things which the majority of Kensington mill workers' families are striving to attain, and which they consider essential to a fair standard of living. The purpose has not been to impose upon these familes an ideal standard."^ In the preparation of the "fair" budget, existing conditions, however, seem to have been given little consideration. Thus, a family of five persons, two adults and three young, non-wage-earning children, was accepted as the standard, the father's earnings being the only source of income. The fol- lowing tabulation shows, however, the status of the 23 fami- lies studied as regards sources of income.' >/6«d.,pp. 68; 7i; 73-76- 'Ibid., pp. 78-79. 'See pp. 30-22 of the present report.'! 'Little and Cotton, op. cit., p. 133. 'Ibid., p. II. 23 Number "f. Sources of income families 1 wage-earner S 1 wage-earner and boarders or lodgers or both 7 2 wage-earners 2 2 wage-earners and boarders or lodgers or both 2 3 wage-earners 3 3 wage-earners and boarders or lodgers or both 3 4 wage-earners and boarders or lodgers or both 1 Total 23 Ages of the children are not summarized in the report but, collected ■ from the descriptions of the separate families, they may be noted as follows : Number of families 23 Families without children 4 Number of children under 14 years of age 28 Number of children age 14 and under 21 16 Number of children age 21 and over 17 Average number of children under 14 years of age per family 1.2 From this tabulation it appears that many families had chil- dren 14 years of age and over and, since "as a rule the children in a Kensington mill worker's family become wage-earners as soon as they arrive at the legal working age,"i it is to be ex- pected that they contribute to the family's support either by turning all of their wages into the family fund or by paying board. A similar failure to take account of conditions actually prevailing appears in the allowances in the "fair" budget for the principal items of expenditure. In the case of rents, for example, the 16 families who paid rent spent an average of $12.75 a month for this item, with only three of them paying $15 or more. No suggestion was made that there was over- crowding or that other undesirable conditions prevailed, but in the allowance for the fair standard, $15 a month is given. This was, moreover, designed to provide a seven-room house, which is more than is usually allowed five persons living at a fair minimum standard. When it came to food, clothing, fuel and the other items, not only were actual expenditures left out of account but even the standard maintained by the families studied. The food allowance, for example, was based on a dietary prepared by the New York City Department of Health. For clothing, the budget of the Fall River mill workers' families studied by the United States Bureau of Labor in 1908 "may be adopted . . . provided the allowance of $33.75 for the mother, and that of $25.35 for a ten-year-old daughter, be increased to $50 and $30, respectively." No reason is given for the increase.^ For health, "an expenditure of $27 will, perhaps" when other ^Little and Cotton, op. ciL, p. 145. 'Ibid., p. 137. 24 conditions are taken into account, provide medical care.' The amount allowed for insurance and saving had no relation to actual conditions but was frankly what the investigators thought it ought to be." The conclusion is reached, on this basis, that " the father of a family consisting of himself, his wife, a girl of ten, a boy of six and a boy of four, must, therefore, earn $1,069.94 per year, ... in order to support his family in accordance with the standard that is here suggested as fair."' As a picture of the lives of families living in the Kensington district of Philadelphia the budgets which were collected have value; and as an estimate of the cost of living on a purely theoretical basis, without budgets, there is a certain interest in the figures offered as representing the cost of maintaining a fair minimum standard of living. When, however, the latter is presented as a derivative of the former, yet with an almost total disregard of conditions actually prevailing, the reader is inevitably led to conclusions which are not warranted from the evidence. They are the results of theoretical con- siderations rather than of study of actual conditions. New York City and Buffalo, 1914 The two reports made for the New York State Factory In- vestigating Commission in 1914 likewise contain budgets of actual families and estimates of the cost of living in which expenditures by these families were not used as the immediate basis for calculations. Budgets were collected from 34 families in New York City, from 18 families in Buffalo and from 17 families in Troy. Although Frank H. Streightoff, who directed the investigation, stated that his estimates of the cost of living in New York City and in Buffalo^ were based on these budgets and on the conclusions of earlier investigations, the only refer- ence to the former is an appendix to the main report, in which the standard of living is described somewhat in detail for each family separately.* The purpose of these studies was " to determine, as definitely as possible, the amount of money necessary for life in simple decency and efficiency."" This was held to include a sufficient amount of nourishing and palatable food, clothing which would " afford protection against all the extremes of weather," which would include " the garments necessary to a proper appearance 'Ibid., p. 138. 'Ibid., pp. 138-142. 'Ibid., p. 14s. There was one family among the 23 studied which met the require- ments of a so-called normal family. Here the father had, in addition to his wages, salary as officer in a club and salary as an officer in a union; there was also income from investment of former earnings. *No estimate was made of the cost of living in Troy beyond the statement that "the coat of living in Troy is not less than in Buffalo and certainly not as great as in New York." Report of the New York State Factory Investigatmg Commission, ot, cit., p. 1828. 'Itid., pp. 1785-1844- 'Ibid., p. 1466. 25 while at work," and "apparel fit for use at sociable aflPairs or religious assemblies," a house meeting certain definitely estab- lished standards of light and sanitation and, in addition, pro- vision for "intellectual recreation and progress." There must be newspapers or periodicals to keep the individual in touch with world events and local affairs. There must be available funds to put the children through grammar school at least; and then there must be opportunity for amusement, for social life, and for religious worship. Moreover, there must be in- cluded in the standard of living provision for emergencies, such as ill health, death and old age. "This is the general concept of a decent livelihood. . . . The term the 'cost of living' as used in this report is the amount of money necessary to provide a decent livelihood."' Although not derived directly from the budgets of families visited in this investigation, the conclusions reached were di- rectly related to the expenditures and requirements of wage- earners' families in the communities surveyed. The cost of food in New York City, for example, was obtained by adding to the amount determined as necessary in the Chapin investiga- tion a sum sufficient to allow for the increased cost between 1907 and 1913, and to meet certain objective tests of sufficiency as determined by those closely in touch with the food require- ments of wage-earners' families. The allowance for rent was based on a preconceived standard of suitability, checked by a study of the housing available. The standard for clothing was a composite of theoretical estimates and the expenditures of actual families. The outlay for fuel and light was likewise derived from earlier studies, confirmed by current practice among those families which were thought to meet minimum requirements. In the sundries group of items also, each esti- mate was said to stand for a scientific test or to be based on the best experience and judgment available. On the basis of these studies it was estimated that, in 1914, the minimum cost of living for a family of five in New York City was $876.43 a year; and, due principally to lower rents and the lesser cost of food, in Buffalo it was placed at $772.43. These totals were divided among the principal items in the family budget as follows: New York City Buffalo Food 37.1% 36.4% Shelter 22.8% 15.5% Clothing 16.0% 18.1%, Fuel and light 2.3% 5.2% Sundries 21.8% 24.8% District of Columbia, 1916 In December, 1916, Congress authorized an investigation of the cost of living among wage-earners in the District of Colum- bia. 'Report of the New York State Factory Investigating Commission, op. cii., pp. 1467- 146S. 26 While this study grew primarily from local interest in a mini- mum wage law for women, it was also made for the purpose of enabling the Commissioner of Labor Statistics to answer certain constantly recurring questions regarding the standard and cost of living among wage-earners' families. i The city was divided into districts in order to obtain a fair representa- tion of government clerks and other wage-earners' families. These were visited by agents of the Bureau of Labor Statistics who secured information regarding incomes and expenditures. Families were chosen whose head was a wage-earner or salaried person earning not more than $1,800 a year; no selection was made as to size or age of members and in many of the families there were boarders and lodgers. 2 A number of the latter were in reality older children living at home and paying board in lieu of turning all their earnings into the family fund. Data collected from 1,481 white families and 629 colored families were tabulated and analyzed. The average size of the white families was 4.9 persons, including boarders and lodgers; the "net" family, that is, excluding boarders and lodgers, even though they might be older children, averaged 3.8 persons. There were children' in 75% of the families, the average number being 2.4 per family having children, or an average of less than two among all families. The average in- come of these white families was $1,231.44 a year; their average cost of living was $1,216.03. This left an average surplus of $15.41 per family. Forty and nine-tenths per cent of the families had neither surplus nor deficit; 30.2% had an average surplus of $150.46 and 29%, had an average deficit of $103.58. ^ Information regarding sources of income was not given in such a way as to determine the average. Of the 1,481 white families, 1,309 had male heads who were at work, 166 had wives or female heads of the family at work; 204 had children at work, but their ages were not specified, and in 11 others there were additional members of the "net" family who contributed to the income. In 756 families, boarders and lodgers contrib- uted and 692 families had other sources of income, unspeci- fied.' An analysis was made in some detail of the expenditures by these families of Washington wage-earners, and food con- sumption was given particular attention. No attempt was made to determine a fair minimum standard of living or the sum required to maintain it. The cost of living as given is the average amount actually spent by families within the income groups which were included in the investigation. 'Congressional Record. 64th Congress, ist Session. Vol. 53, Part 7, p. 6479. 2The above refers to the investigation of the cost of living among families; that of wage- earning women is not summarized here. 'The definition of children is not given. 'Monthly Review, October, 1917, pp. 3. lo-ii. ^Monthly Review, October, 1917, pp. lo-ii- 27 Dallas, 1917 In the sjjring of 1917, the mayor of Dallas appointed a com- mittee of citizens to study the cost of living for the purpose of furnishing a guide for wage advances to city employees. This committee arranged with a number of city and factory workers to keep household accounts for a period of 30 days, on special record forms provided by the committee. Fifty of these ac- count records were tabulated and furnished the basis for the report. The average size of these families was 4.8 persons.! Their composition is not given. The average number of children in school was 1.4 per family; this is one-half of the average number of children per family. 2 The ages of the children are not given. In addition to the wages of the father, which fur- nished 84.6% of the average family income, 3.19% of the latter was contributed by the mother, 5.36% by children and 6.85% of the income was obtained from other sources, in- cluding boarders and lodgers.' Average annual income and average annual cost of living of these families was estimated largely but not entirely by multi- plying the income and expenditure of one month by 12. Uni- versity students who assisted with the field work endeavored, however, to determine, as far as possible, the extent to which monthly expenditures were representative of conditions through- out the year and to make necessary adjustments accordingly. Among these 50 families, average income was placed at $962.83 a year and average cost of living at $1,134.55. This meant an average deficit of $171.72 annually. In 17 families there was no debt. The largest amounts owed were "property debts," although unpaid bills for groceries and doctors' services were also noted.'' On the basis of the results of this investigation and from independent studies of the cost of food and of clothing, it was estimated that the annual cost of maintaining a "safe normal" standard of living for a family of five persons in Dallas in 1917 was $1,081.72.5 The lowest "bare subsistence" standard for a similar family was estimated to cost $747." This investigation was made very hurriedly and the analysis of the data was not presented in great detail. The results are interestingj however, as showing the cost of living and distribution of items *in the budgets of wage-earners in a section of the country from which very little information of this charac- ter is available. ^Report of the Dallas Wage Commission, op, ciL, p. ii. ''Ibid., p. 9. 'Ibid., p. 5- *Ibid., pp. 6-8. Kbid., p. 2. 'Ibid., p. II. 28 Philadelphia, 1916-1918 This study was made by the Bureau of Municipal Research of Philadelphia in order to estimate the cost of maintaining a fair minimum standard of living among city employees. The distinctive feature of this study is that it is apparently the first attempt to express in terms of quality and quantity as well as of price, the make-up of a fair standard of living. The basis of the estimates of the content and cost of a fair standard is said to have been a group of 260 family budgets, but it is difficult to determine how far, as a matter of fact, these were followed in preparing the standard budget, because of the lapse of time between collecting the information from the families and formulating the standard. The budgets included expenditures for a year ending some- time between August 15, 1917, and May 15, 1918. They were obtained by home visits and from account books kept by families of skilled and unskilled workers in all sections of Philadelphia. The only requisites were that families should be self-supporting, that the principal bread-winner should earn not more than $2,000 a year and that there should be children under 14 years of age. From the family budgets thus col- lected in great detail an attempt was made to determine the content and cost of a fair minimum standard of living. The 260 families averaged 5.04 persons, exclusive of boarders and lodgers. Their average yearly income was $1,262.09 and their average annual cost of living was $1,261.93.1 This in- come was derived as follows: from the father of the family, 84.8%; from the children, 6.3%; from boarders, lodgers or others living with the family, 5.9%; from earnings of the wife and miscellaneous sources, 3%. 2 The families distributed their expenditures as follows: for food, 44.1% of the total; shelter, 14.1%; clothing, 13.9%; fuel and light, 5.1%; sun- dries, 22.8%.3 From a study of the quantity and cost of articles used by these 260 families, it was estimated that, in the autumn of 1918, $1,636.79 annually would be required to support a family of five consisting of husband, wife, a boy aged 13, a girl aged 10, and a boy aged six, at a fair standard of living.* Inasmuch as the expenditures listed in the original budgets covered a period of 21 months ending in May, 1918, and the estimated cost of living was established several months after the budgets were completed, it is not possible to determine at all points how closely the standard adopted conformed to •Bureau of Municipal Research of Philadelphia, op. cit., p. 36. These figures include a possible discrepancy of not more than s% between income and expenditures. Hbid.,i^. 30. Ubid., p. 36- */6«(i/, p. S- 29 actual expenditures. At certain points, however, the de- parture from them is evident. The distribution of the items in the standard budget differs from the average of the actual budgets as noted below. Budget items Percentage of total expenditures allowed in — Actual budget Standard budget Food 44.1 14.1 13.9 5.1 22.8 40.3 Shelter 14.7 Clothing 18.3 Fuel and light 4.6 22.1 All items 100.0 100.0 In devising the standard budget, particular attention was paid to quantity and quality, with the idea that the items listed in the budget could be priced from time to time and that city employees' wages could be adjusted accordingly. Eighty-two percent of the total family budget was thus specified. The specified standard included housing, fuel and light, food, clothing, carfare and cleaning supplies and services; the unspecified standard included health, furniture and furn- ishings, taxes, dues and contributions, recreation and amuse- ments, education and reading, insurance and miscellaneous expenditures. These constituted the remaining 18% of the budget. Expenditures by the 260 families whose budgets were analyzed showed that the cost of the unspecified standard averaged about 21% of the specified standard. This ratio has been maintained, therefore, throughout the studies of the cost of living made by the Bureau of Municipal Research in Philadelphia. Three supplements to the original report have been issued. These showed the annual cost of maintaining a fair standard of living in Philadelphia to be $1,803.14 at prices in November, 1919;i ?1,988.32, in August, 1920,2 and $1,742.68, in March, 1921.3 Conclusion The budgets summarized in this chapter, although diflFering from one another in many respects, had as a common purpose the determination of the minimum cost of living among the groups which were studied. With the exception of the investi- gation by the United States Bureau of Labor Statistics in the District of Columbia, the estimated cost does not represent 'Bureau of Municipal Research of Philadelphia. Citizens' Business No. 393, December 4, 1919. Uhid., No. 433, September 9, 1920. 'Ibid., No. 463, April 7, 1921. 30 an average of actual expenditures but it is a figure based on the best judgment of the investigator as to what constitutes a fair minimum standard of living. In the case of all studies except those in Philadelphia and that by the New York State Factory Investigating Commission, this fair minimum was derived directly from the expenditures of the families whose budgets were analyzed. In the case of the Philadelphia studies, as already noted, the theoretical standard frequently had little relation to the expenditures of the actual families. That by the New York State Factory Investigating Commission, although not reflecting directly the budgets collected, more nearly represents the prevailing standard and cost of living in the communities surveyed. The figures given for the District of Columbia are averages of con- ditions among the families studied, regardless of whether or not these conditions were satisfactory. The estimated cost of maintaining a fair standard of living, which was made in connection with all of the studies noted except that in the District of Columbia, with two exceptions was based on the requirements of a family of five persons.i Kennedy, in his study of the stockyards families and the United States Bureau of Labor in the study of cotton mill families, gave data from which the cost of living of families of other sizes might be calculated. In the studies by the United States Bureau of Labor among cotton mill families in the South and in Fall River, by the New York State Factory Investigating Commission, and in the two studies in Philadelphia, the family of five was arbitrarily as- sumed to consist of a man, woman, and three children under 14 years of age. In the other investigations, where the unit of measurement was a family of five, the ages of its members were not specified. In the studies by Chapin and by the New York State Factory Investigating Commission in New York, by Howard and by the New York State Factory Investigating Commission in Buffalo, by the United States Bureau of Labor Statistics in Washington, and by the Bureau of Municipal Research in Philadelphia, the families selected for study were within specified income groups. While these were believed to represent the average or typical income of wage-earner's families, and while the fair minimum standard established was not an average of expenditures,^ it should nevertheless be remembered that the families studied were selected, not taken at random, and that the results re- garding income and expenditure are inevitably colored by this circumstance. 'The size of the Homestead family was not specified, but families from whom budgets were collected averaged 4.4 persons exclusive of boarders and lodgers; with boarders and lodgers there were five persons per family; the Buffalo families studied by Howard in 1908 averaged six persons. 2No estimate of a fair minimum is given for Washington. 31 It is to be noted that in no case except the study of Kensing- ton mill workers' families were the sources of the income re- quired to maintain a fair standard of living specified. Certain conclusions were reached regarding the minimum cost of living; a minimum wage for any one member of the family was not specified. This minimum cost of living was applied to a family of five persons, but frequently the age and sex composition of the family was not indicated, nor were the sources of income from which this estimated cost of living was to be met. A number of the writers of the reports on these local studies of the cost of living called attention to the fact that the families necessarily were selected for intelligence, since only those fur- nished information who kept accounts or could grasp the mean- ing of the investigation sufficiently to lend adequate coopera- tion. For this reason the standard of living represented by these studies was believed to reflect an even better condition than the average actually prevailing, i The contents of the different budgets summarized in this chapter varied greatly, dependent on many factors. With the exception of the two Philadelphia studies, all of the esti- mates of the minimum cost of living were based on conditions actually prevailing. While they allowed for the maintenance of what was considered to be a fair standard of living, they took into account local customs and the available means of real- izing them. They attempted to portray a fair standard of living which was not beyond the means of realization by the families to whom it was to apply. The two estimates of the minimum cost of living in Philadelphia departed in so many respects from average conditions among the families whose budgets were studied as to constitute theoretical budgets rather than budgets reflecting actual conditions. Several investigators called attention to the fact that the standard of living maintained by a family depends not only upon available income but also upon spending habits; and that whether or not a fair standard can be maintained for a given amount of money depends to a considerable extent not only on managing ability of the mother but upon the ideals of the entire family. Finally, it is to be remembered that most of these budgets were constructed as matters of general interest, and for general application among the groups of families studied. While a number of them were made as companion studies to wage investigations, only those by the Dallas Wage Commission and the Philadelphia Bureau of Municipal Research were designed specifically as a guide for the establishment of wage rates. *See, for example, More, op. cit., p. IV. 32 Ill THE STANDARD OF LIVING Collecting, tabulating and analyzing family budgets for the purpose of establishing the minimum cost of maintaining a fair standard of living necessarily requires a considerable amount of time, labor and expense. After a number of such studies of family budgets had been made, followed by estimates of the minimimum standard and cost of living as described in Chapter II, it became possible to make these estimates without the collection of budgets. The saving thus effected was especially important when budgets were desired quickly for use in making wage settlements. The problems to be met in making an investigation of the cost of living according to this plan were three: first, to deter- mine the standard of living whose cost was to be measured; second, to fix the size and composition of the family to whom this standard was to be applied; and, third, to collect prices of the various goods and services listed. Such an investigation is, therefore, a study of prices of the items making up an average family budget rather than a study of family expenditures for these items. The collection of prices, once the standard of living and the type of family have been settled, is, of course, a relatively simple matter. In the present chapter are reviewed the best known of the attempts to estimate the cost of living on the budgetary plan, made without collecting incomes and expenditures from actual families. These are all based on the requirements of a family of five persons, consisting of man, wife, and three non-wage- earning children. The representative character of this family will be discussed in Chapter IV. These estimates of the cost of living, made on the budgetary plan, fall into two general groups. The first, which applies approximately to the standard established by Chapin in 1907, aims to supply the requirements of a minimum American standard of living. It not only includes allowances for the elementary necessities of food, shelter, clothing, fuel and light, but it also makes some provision for those sundries which are usually considered a part of an American standard of living, such as medical care, church contributions, recreation, educa- tion, upkeep of household equipment, carfare, insurance and other miscellaneous items. Estimates as to the content and 33 cost of this standard have been based on what was actually available for workingmen's families in the communities sur- veyed and they were for the kinds and amounts of goods and services workingmen actually were using. In 1917, the first attempt was made to estimate the cost of maintaining a somewhat different standard. This has been variously designated as a "minimum comfort budget,"i or a "minimum standard of wholesome living,"^ or a "minimum standard of health and decency.''^ It is described as somewhat above the level of the budgets developed by Chapin and others who had previously studied the standard of living of working- men's families, and its content is based on the budgets of the more highly paid and skilled workers.^ In some instances these budgets have been related to the standards and require- ments of a given set of workers in a given community;' in others, account has not been taken of specific local conditions but a general budget has been formulated based on ideal con- ditions, and put forth as of general application." While, therefore, the first group of budgets aimed to deter- mine the limit below which family expenditures could not go without the sacrifice of something absolutely essential to the maintenance of an American standard of living, and were based on conditions actually prevailing in a given locality, those in the second group include items and amounts which add to com- fort but which cannot rightfully be called necessities. Many of these comfort items, moreover, could not be obtained in some localities, because they did not exist, even though the budget provided for their acquisition. The standard of living contemplated in the first estimate is determinable within a narrow margin of error, largely by ob- jective tests. It relates to the needs of a given group of work- ers in a given community. The determination of a minimum of comfort standard of living necessarily rests more largely on subjective considerations, and for this reason cannot be either so definite or so readily ascertainable as the former. Further- more, in practice this type of budget has been greatly general- ized, on the theory that what should be a standard of living for one group of workers in one community should be equally applicable to another group in another community. ^Bureau of Applied Economics, Inc., "Standards of Living," revised edition, Bulletin Number 7, p. 97. ^Ibid., p. IIS. ^Jbid., p. 27. ^National War Labor Board. Memorandum on the Minimum Wage and Increased Cost of Living. Submitted by the Secretary at the Request of the Board at its Meeting on July 12, 1918, Washington, 1918, p. 14. ^'Standards of Living," op.cit., pp. 26-47 564-72; g6-ioo;ii5-ii7; Monthly Labor Review, February, 1921, pp. 61-66. "Memorandum on the Minimum Wage, etc., op. cit., pp. 14-17 ;"Standardsof Living," op. cii., pp. I-2S; 48-63- 34 a O H « Q < H iJ GO n pa •J o < ^^ ft o >< S SB. I"' 5 s Cfl o C M ^ s § to w (J W H to O CO (I) CO 3 S I s a a " S a u ■a -2 •si "2 -as to «ia o a 0"* •2!^ •a u o .9 I sal § ■e i^ a ? +3 +* *^ K H s & U O ut-y § o Cov S.-s go .•a.aa 2^1 1 ss; •eg SB ^ . Si '.a Tj3 rt a^ as " K HE'S « ^2 so. * 15 fe+3 o §-. 3 <:i •c^i 'S'S.s a«« o^.ag d Zi eS to -^aub o'a-ag oS ^S 35 Q Iz; t> I? M bS Q s o M ei K H Q Iz; < H I to n <: , Q ° E ^ 5 B w < < " go iz; o J < o O g S K H O Ul H H < 3 o U I 5 « 3 S % ^ § 6 S S W 1 I CO 00 00 ooV 00 ^§1 ■* -^ •^ lO 10 3-^ CM a « s aoo to 00 P CO 10 »0 1 ■* :§ o •* "5 ii i Estimated minimum cost for five persons annually g 00 wi 22 00 1" to ■" g 1 1 CO CO CO 3-sll » C/3 C/3 CO 1 1 eg a fit |||s Hals CO s ci5 i CO i tn c3 CO 1 p ii t lis lis ^1" 22 |2 g o 1-1 1 3" III; 6 1^ Jo 62 § 00 1 §1 1 1 11 S i» S: •^s « ^ ►4 < O O s H o en M SSI ^'■S o ic C wS"|§ •OtI XD " s» -3 o 3 O 01 1-2 8 E-iSoS 3j: ■^ CO 03> O V u es alls' SCO ; 09 P.S E-E 00* CO u •° o , 3 ••rt.sj'g 3.9 °« a £|f3| 3» zo SZ J. sg C C M .2 hi 0'S.2:S 1-2 i° O CS O (fl wo. uo! 5 3'-5 III Mi83^ •fi £ o^ go. lis mas s.Ss 3fl 0-5 •s >- ■a o ■a S.Sg •O » M S.s-s *r Eja 3 •1.a|» '3 Men § |§|.s| go* ZO 37 In Table 3 are listed the principal estimates of the cost ot living of American wage-earners as made on the budgetary plan without the collection of budgets. ^ In the first section are given those budgets which measure the minimum cost of main- taining an American standard of living according to conditions actually prevailing; in the second section are the estimates of the cost of maintaining a so-called minimum standard of comfort. These are discussed in the following pages.2 Minimum American Budgets New York City, 1915: As a part of the attempt to standardize salaries paid to em- ployees of the City of New York, the Bureau of Personal Service of the Board of Estimate and Apportionment, in co- operation with the Bureau of Municipal Research, in 1915 made a study of the cost of living for an unskilled laborer's family in New York City. "After careful consideration of the average size of families among laborers in general, in the United States, in the city of New York and among the rank and file of the Department of Street Cleaning in particular, it was decided to select for purposes of study a family consisting of five members: a wage-earner, his wife, and three children of school age, who could not be expected to contribute anything to the family support."^ The composition of the family having been determined, the content of the standard of living was established. Thus, it is ^A number of estimates of the minimum cost of living Iiave been prepared by charitable societies but these are not listed here, even though some of them are said to represent the cost of maintaining a fair standard of living. 3The budgets are arranged in chronological order in the text and are noted by the locality for which they were made. The reports of these investigations may be found in the fol- lowing publications: N&m York City, 1915: New York City. Board of Estimate and Apportionment. Report on the Cost of Living for an Unskilled Laborer's Family in New York City. Sub- mitted by the Bureau of Standards to the Committee on Salary and Grade, 1915; ibid.. Report on the Increased Cost of Living for an Unskilled Laborer's Family in New York City. Prepared by the Bureau of Personal Service, iQi?- New York City, 1918: National War Labor Board. Memorandum on the Minimum Wage and Increased Cost of Living. Submitted by the Secretary at the Request of the Board at its Meeting on Jtdy 12, 1918, Washington, igiS.p. 10. Local Studies by the National Indtistrial Conference Board: National Industrial Con- ference Board. "The Cost of Living Among Wage-Earners." Fall River, Mass., October, 1919, Research Report No. 22; Lawrence, Mass., November, 1919. Research Report No. 24: North Hudson County, N. J., January, 1920, Special Report No. 7; Greenville and Pelzer, S. C., and Charlotte, N. C., January and February, 1920, Special Report No. 8: Cincinnati, Ohio, May, 1920, Special Report No. 13; Worcester, Mass., June, 1920, Special Report No. 16. San Francisco, Cat., 1917: Memorandum on the Minimum Wage, oP. cit., pp. 47-49; "Standards of Living," revised edition, Bulletin Number 7, pp. iiS-ii7* Bureau of Applied Economics, Inc., Seattle, Wash., 1917: Memorandum on the Mini- mum Wage, op. cit., pp. 17-21; "Standards of Living," op. cit., pp. 96-101. New York City, 1918: Memorandum on the Minimum Wage, op. cit., pp. 14-17 ; "Stand- ards of Living," op. cit., pp. 92-9S. Washington, D. C, 1919: United States. Bureau of Labor Statistics. "Tentative Quantity and Cost Budget Necessary to Maintain a Family of Five in Washington, D. C, at a Level of Health and Decency." Monthly Labor Review, December, 1919, pp. 22-29; "Standards of Living," op. cit., pp. 26-47. Bituminous Mining Towns, 1920: "Standards of Living," op. cit., pp. 48-63. New York City, 1920: Monthly Labor Review, February, 1921, pp. 61-66. ^Report on the Increased Cost of Living for an Unskilled Laborer's Family, op. cit., p. S. 38 stated in the report that "a family consisting of five people needs at least four rooms to meet the demands of decency. . . . Four rooms ... for five persons is slightly above the accepted standard of 'one and one-half persons to a room'."i The_ amount of food required was based on the scientific analysis, by nutrition experts and dietitians, of the quantity of different kinds of food required by a family of the type under consideration. 2 Of the final estimate as to what constituted a minimum of food it was stated " that it is possible to sustain life on a less varied and less expensive diet than that considered in this report, but as stated before, this study is based upon standards of living consistent with American ideas. "s The estimate for clothing was made in the same way as that for food, based "upon average common sense requirements."^ Other items entering into the cost of living, such as carfare, fuel and light, care of health, insurance, recreation,' reading material, church contributions, etc., were listed in a similar manner. The requirements of the entire budget having thus been determined, their cost was ascertained by collecting prices of the goods and services in representative neighborhoods where unskilled laborers lived and made their purchases. By this method it was estimated that the average cost of living for an unskilled laborer's family of five persons in the city of New York, living at a minimum standard "consistent with American ideas," was $844.94 in February, 1915. Through the collection of prices for the same list of requirements two years later, the cost in February, 1917, was placed at $980.42, annually." Of the total budget in 1915, 45.43% was allowed for food; 19.88% for shelter; 12.33% for clothing; 5.06% for fuel and light; and 17.30% for sundries.' This budget represented, both as to content and cost, an attempt to meet fairly the needs of the families of unskilled laborers in New York City. The quantities and qualities such families actually were buying were priced at the places at which they made their purchases. At the same time an attempt was made to insure that a fair standard should be maintained and that a minimum of satisfactions should be allowed, not only for the primary necessities but also for some of the less necessary wants as well. Nothing was included which could not be obtained in the neighborhoods in which these families lived; nothing was omitted which was really funda- mental. Ubid., p. II. 'Ibid., pp. 12, 13. 'Ibid., p. 13. *Ibid., p. 14. ^The report states: "For recreation . . . we have allowed occasional trips to the beach, incidental carfare, moving picture shows, Christmas and birthday presents and miscel- laneous amusements." Ibid., p. i6. 'Ibid., p. II. Ubid., p. II. 39 New York City, 1918: William F. Ogburn, examiner for the National War Labor Board, in July, 1918, submitted for the Board's consideration a minimum budget which was said to have been reached as the result of a study of 600 actual budgets of shipyard workers in the New York shipbuilding district. This mini- mum budget is itemized as to the major expenditures in- cluded, but no basis for the allotment of costs is given beyond the expenditures of the shipyard workers, with which the theoretical budget is not, at all points, in accord.' There is no discussion of the items or of their sufficiency, but, as shown in the table, of the $1,386 which was estimated to be the mini- mum cost of living for a family of five in New York in the summer of 1918, 44.37% was allowed for food, 13% for shelter, 16.88% for clothing, 4.47% for fuel and Hght and 21.28% for sundries. A comparison of this distribution of expenditures in the minimum budget with the distribution allowed in the more liberal budget is shown on page 49 of the present report. Local Studies by the National Industrial Conference Board: The National Industrial Conference Board has published six reports on the cost of living among wage-earners in specified localities. Lacking precise information as to the size and com- position of wage-earners' families in the communities surveyed, a family of two adults and three children under 14 years of age where the father was the only wage-earner was adopted as the unit of measurement. The standard of living prevail- ing among the wage-earners studied in each community was carefully noted and such items were included in the budget as would meet existing local standards, and as could be obtained by the families requiring them. Thus, the housing standard varied from place to place. In Fall River, Lawrence and Worcester, Mass., and North Hudson County, N. J., two-and three-family houses were the prevailing type; in Cincinnati, single frame cottages were most representative; in the southern textile centers, single company-owned frame houses were generally found. Food and clothing lists were slightly modi- fied from place to place, prevailing means of heating and light- ing were always taken into account, and such of the sundries items as carfare, recreation, etc., were varied to meet local conditions. In this way, although based on the theoretical requirements of a theoretical family, the minimum standard and cost of living for a family of the given size and composi- tion was very closely approximated. That these varied from place to place, even though in each case the budget shown represented the minimum standard of living, was as evident from these investigations of prices as 'Cf. Monthly Review, April, 1918, pp. 151-152. Ogburn's budget was supposed to be of general application, but since it was based on the New York shipbuilding district it has been listed as a New York budget. 40 from studies of budgets of actual families. In Fall River, where rents were low and church and school contributions were large, a smaller proportion of the total budget was apportioned to shelter and more to sundries than in Lawrence, where rents were higher and less was required for a minimum of sundries. In Cincinnati, where natural gas was used and fuel and light were cheap, less, proportionately, was required for this item than in Worcester, which was dependent on anthracite coal and artificial gas. Extremely low rents and greatly increased cost of food account for the unusual distribution of items in the budgets of families in the southern textile centers. An analysis of these minimum budgets for wage-earners, constructed by the National Industrial Conference Board, indicates that provision is made not only for the elementary necessities but also for certain more cultural, although none the less fundamental, needs. In all cases, the items included as well as their cost were determined only after a careful study of local standards and the available means of realizing them. Racial habits, local customs, and goods and services locally available were always given careful consideration before the budgets were completed. In this way, the budgets represent a practical standard even though they were based on the theoretical needs of a theoretical family. Summary: All of these budgets representing the minimum American standard of living have a common purpose, i.e., to determine the minimum cost of maintaining a family of five persons at the lowest standard consistent with American ideals, according to conditions as they actually exist. They exclude non- essentials, but the minimum requirements of most things a normal family would require are included. Most important of all is the fact that in establishing the standard and its cost, local customs and tastes have been taken into account as well as local means of satisfying the demands which are included. They represent a minimum from which other standards may be graded up but below which none may fall without the sacrifice of something essential. Minimum Comfort Budgets The minimum comfort budgets, on the other hand, are based on the needs and expenditures of higher grade and skilled workers. They represent an ideal to be attained, rather than a minimum of prevailing conditions which can be considered acceptable and by which all others are to be measured. Attempts to establish a budget for American workers on this higher standard seem to have developed simultaneously in two cities on the Pacific Coast in the fall of 1917. In Octo- ber, 1917, Jessica B. Peixotto of the faculty of the University of 41 California prepared a detailed estimate of the cost of main- taining "a minimum standard of wholesome living and not mere subsistence" in San Franciscoi and at the same time William F. Ogburn and other members of the faculty of Eco- nomics and Sociology of the University of Washington prepared a "minimum comfort budget" for Seattle.^ The following summer, Ogburn prepared for the National War Labor Board a budget "for a level above that of a minimum subsistence."^ In August, 1919, the United States Bureau of Labor Statistics attempted "to determine the cost of maintaining the family of a government employee in Washington at a level of health and decency."* Early in 1920 the articles listed in this budget were priced in several bituminous mining towns and a budget thereby was worked out for bituminous miners.' The minimum quantity and cost budget necessary to maintain a government employee's family of five in health and decency in the city of Washington was later revised to apply more closely to the needs of indus- trial workers and has been used in a number of cities lately for the purpose of determining the cost of living in those places." The budget thus developed for the typographical unions in New York City in 1920 is reproduced in the present chapter. San Francisco, 1917: For use of an arbitration board appointed to settle a dispute resulting in a strike of conductors of the San Francisco-Oakland and San Jos6 Railway (Key Division) in Alameda County, Cal., Jessica B. Peixotto of the Department of Econom- ics of the University of California prepared a detailed estimate of the cost of the items required to maintain a workingman, his wife, and three children of school age in San Francisco, at a "minimum standard of wholesome living and not mere sub- sistence."' The total cost of this budget in San Francisco at October, 1917, prices was $1,476.40. This amount was apportioned to the major items in the family budget as follows: food, 36.6%; shelter, 16.2%; clothing, 19.5%; fuel and light, 3.7%; sun- dries, 24%. The latter item included, in addition to the usual goods and services listed in the sundries group, $60 a year for savings. This budget was provided for the class of workmen "which insists upon having food enough to provide a palatable and somewhat varied dietary; shelter and clothing that conforms ^Memorandum on the Minimum Wage, op. cit., pp. 47-48, 'Ibid., pp. 13-14; 17-21- 'Ibid., pp. 14-17. ^"Tentative Quantity and Cost Budget," op. cit. ^''Standards of Living," op. cit., pp. 48-SS. ^Ibid., pp. 1-25. 'Memorandum on the Minimum Wage, op. cit., p. 47. 42 to the traditional ideas of the 'decencies' rather than the 'necessities;' some income to pay for schooling the children, for relaxation in leisure hours, and something to provide against risks of ill health, invalidity and death. "i Professor Peixotto concluded that "a family of man, wife, and three children of school age can not be maintained without getting into debt or receiving aid on much less than $110 a month. When the normal bread-winner is paid less than this sum, one of three things, any one of them harmful for the group and for the community, is likely to happen: "1. Other members of the family will have to work to eke out the income, or "2. There will be less food than is necessary for the men to do efficient work. The risks of ill health to all members of the group and the consequent costs to the group and to society are equally plain, or "3. The group must go without many of the articles noted under Sundries and House Operations. . . ."2 Seattle, 1917: In the fall of 1917, a wage dispute having arisen between the Puget Sound Traction, Light and Power Company, the Tacoma Railway and Power Company and their employees, a board of arbitration was appointed to determine what rates of wages should be paid. Both sides submitted budgets designed to show the minimum cost of living, and the award was finally made on the basis of the budget constructed by William F. Ogburn of the University of Washington. This budget was said to have been based on the expenditures of actual families as determined through a field investigation by Ogburn and other members of the faculty and students of the University, but these budgets have not been published. This budget of Ogburn was called a "minimum comfort budget and is slightly higher than a minimum health budget." Since, however, the latter had not previously been described, unless the budgets later called "subsistence" were at that time called "health budgets," it is not possible to determine where and how the minimum comfort and the minimum health bud- gets differ. The minimum comfort budget was designed for the needs of a family of five persons for the following reasons: "(a) Three children at least are necessary for the race to perpetuate itself. {h) Federal and State experts do not make out budgets for less than families of five, thus, neither public nor expert opinion ^Jbid., p. 47. Professor Peixotto submitted another budget, calling for $1,255.40 a year as "a minimum allowance to enable such a family to maintain its independence." Details of this have received no publicity.'' Report of the Board of Arbitration in the Wage Controversy between San Francisco-Oakland Terminal Railways and Carmen's Union Division No. tq2. Amalgamated Association of Street and Electric Railway Employees of America, July 3, 1918, p. 6. 'Memorandum on the Minimum Wage, of. cit., p. 47. 43 sanctions a smaller standard, (c) Standards of a warring and industrially competing nation would seem to demand three children as a minimum, (d) Unmarried men are less desirable than married men, individually and socially, physically and morally; and the economic barrier to marriage is recognized as an important one. (e) The family of five, while larger than the average in the company's employ, may nevertheless be taken as the standard family of workmen receiving the maxi- mum hourly rate, and the lower differentials worked out from this rate."i Estimates for the cost of clothing were based on the as- sumption that the wife did some of the family sewing; the meat allowance was lower than actually prevailed among carmen's families, while the insurance and savings items were larger. 2 The quantity of each item having been estimated and its cost ascertained from the collection of prices, these were combined to determine the minimum cost of maintaining the standard. This was found to be ?1,50S.60 a year at prices current in Seattle in the fall of 1917. This budget was divided as follows: for food, 35.4%; for shelter, 12.2%; for clothing, 19.4%; for fuel and light, 6.3%; for sundries, 26.7%. In sundries is included something for saving. Provision for saving cannot, of course, be legitimately included as an item in the cost of living, but in the present budget it is combined with insurance without itemization. New York City, 1918: This budget, which was " based largely upon a study of the workers in the shipyards in the New York district who received the higher incomes," was designed to represent a "level above minimum subsistence" for the entire United States. It was prepared by William F. Ogburn for the National War Labor Board in 1918, as a companion study to the minimum budget summarized on page 40 of the present report. Its total annual cost for a family consisting of man, wife, and three children under 14 years of age was placed at ?1,760.50 in June, 1918. This was distributed to the different budget items as follows: food, 35.5%; shelter, 12.5%; clothing, 17.8%; fuel and light, 4.2%; sundries, 30%. A comparison of this distribution of budget items with that in the minimum budget is shown on page 49 of the present report. Washington, 1919: In August, 1919, the United States Bureau of Labor Sta- tistics made a study of the cost of living in the District of Columbia. This was for two purposes. The first was to estab- ^Memorandum on the Minimum Wage, oi). cil., pp. iS-i^"*. ^These items are combined so that the amount specifically allowed for savings cannot be subtracted. 44 lish a "quantity budget" in which emphasis would be laid on amounts, qualities and frequency of replacements; the second was to ascertain the cost of purchasing goods and services included in the quantity budget in Washington in August, 1919. Experts were called in from various parts of the country to assist in the determination of what should be included in the budget and its cost was ascertained by agents of the Bureau who shopped in the Washington stores patronized by wage- earners. This budget aimed to provide for an average family consisting of husband, wife, and three children below the age of 14 years: "(1) A sufficiency of nourishing food for the maintenance of health, particularly the children's health; "(2) Housing in low-rent neighborhoods and within the smallest possible number of rooms consistent with decency, but with sufficient light, heat, and toilet facilities for the maintenance of health and decency; "(3) The upkeep of household equipment, such as kitchen utensils, bedding, and linen, necessary for health, but with no provision for the purchase of additional furniture; "(4) Clothing sufficient for warmth, of a sufficiently good quality to be economical, but with no further regard for ap- pearance and style than is necessary to permit the family members to appear in public and within their rather narrow social circle without slovenliness or loss of self-respect; "(5) A surplus over the above expenditures which would permit of only a minimum outlay for such necessary de- mands as "(a) Street car fares to and from work and necessary rides to stores and markets; "{b) The keeping up of a modest amount of insurance; "(f) Medical and dental care; "{d) Contributions to churches and labor or beneficial organizations; "{e) Simple amusements, such as the moving pictures once in a while; occasional street car rides for pleasure, some Christmas gifts for the children, etc.; "(/) Daily newspaper.' " Yet this was not intended as an ideal budget but merely as "a bottom level of health and decency below which a family cannot go without danger of physical and moral deterioration. This budget does not include many comforts which should be included in a proper 'American standard of living.' Thus no provision is directly made for savings other than insurance, or for vacations, or for books and other educational purposes. "On the other hand, a family with the items listed in this budget should be able to maintain itself in health and modest comfort. It shou® have a sufficiency of food, respectable '"Tentative Quantity and Cost Budget," op. cit., p. 6. 45 clothing, sanitary housing, and a minimum of essential 'sun- dries'."! The Bureau of Labor Statistics emphasized the fact, however, "that the maintenance of living on the level indicated does not necessarily require the receipt of an annual income of precisely this amount."^ This is because some families have less than three children, some have savings invested in a house or other income-yielding venture; many economies are possi- ble through buying advantageously, through the ingenuity of the house-wife in making clothes, planning meals, and the like. "In these and many other ways, families are often — it might well be said usually — able to maintain a decent stand- ard of living at a somewhat lesser cost than the market prices of the budgetary items. "^ The cost of the goods and services listed in this budget, at prices current in Washington in August, 1919, was placed at $2,262.47. Of this amount, 34.2% was allocated to food; 13.3% to shelter; 22.7% to clothing; 5.6% to fuel and light; 24.2% to sundries.' Bituminous Mining Towns, 1920: While the principal object in compiling the budget for the family of a government employee in Washington was to provide information regarding the cost of living which Congress might use in adjusting salaries, its other very important function was to provide a list of the minimum amount of goods and services needed for an American family of five to maintain life at a level of "health and decency," that is, to establish a standard of content as well as of cost. This so-called "quantity budget" was used by William F. Ogburn as the basis for the budget he presented to the United States Bituminous Coal Commission in January, 1920, "the theory being that what is a standard of health and decency for families of Government employees should in its main out- lines also be the standard of health and decency for families of mine workers. The prices of the various items may be different in coal mining centers in 1920 from the prices in Washington in 1919. There rhay also be some variation in the standard; the miners need more food and their clothing re- quirements are different. But the main purpose borne in mind was this — to determine a standard of living in coal min- ing communities necessary for health and decency, based on a determination of this standard by the Bureau of Labor Sta- tisdcs for Washington, D. C."' ^"Tentative Quantity and Cost Budget," o^. cil,, p. 7. Hdem. 'Ibid., p. 8. *Ibid,, p. 10. •"Standards of Living," op, cit., p. 48. 46 Costs were obtained by agents of the Bureau of Labor Statistics who collected prices of the items listed in the budget in two bituminous mining towns, and also from records of the Bureau of Labor Statistics showing costs in additional localities. The budget does not, therefore, apply to any one community. The following statement was made relative to food: "The food budget presented here is an average dietary made up from diiFerent sections of the country and is, there- fore, not peculiar to any one district or locality. It seems to be in a good many ways a desirable standard to price in minimum quantities. Perhaps a single mining community may have peculiarities of diet, but if the diets in all of the mining communities of the United States could be collected, very probably they would average out in very nearly the proportions found in the accompanying dietary, which is really an average of dietaries from various parts of the country. There may be in the dietary certain articles, such as watermelon or sourkraut, which may not be used in a particular group of miners' families, but it is thought that the amount of these special types of food allotted in this dietary is so small that it does not invalidate its applicability. In other words, the great bulk of the dietary is made up of staples used probably in all communities."! Five hundred calories per day were added to the food al- lowance of the government employee in Washington in order to insure that the miner, presumably at heavier labor, was adequately fed. For the clothing requirements, certain modifications were made in the man's budget developed in Washington in order that it might meet the peculiar needs of the bituminous miners; the clothing allowance for the woman and three children were the same in the miner's family as in the one for the family of a government employee in Washington. Housing, of course, varied greatly in the different mining towns and the allowance made was recognized as inadequate in some places and as excessive in others. The cost of fuel, light and sundries was likewise a generalized average, frequently inapplicable to any given town. The total of this budget, which is supposed to represent the average cost of maintaining a standard of health and decency among bituminous miners' families in January, 1920, was placed at $2,243.94 annually. This was apportioned as fol- lows: for food, 35.1%; for shelter, 9.6%; for clothing, 20.3%; for fuel and light, 3.1%; and for sundries, 31.9%. The latter includes $140 a year necessarily spent by many miners for ex- plosives and tools. The food allowance takes account of $15 annually saved from the market cost, because of the general prevalence of gardens and the keeping of chickens. ^ Ubid., pp. S6-S7- 'On page 60 of "Standards of Living." the amount required for explosives and tools is given as $140; on page 49, as $40. The report of the Commission gives the total budget as I2.243.94. with $140 allowed for explosives, smithing, etc. United States. Bituminous Coal Commission. Award and Recommendations, Washington, 1920, p. 79. 47 Some articles of food listed were reported not to be found in certain towns; housing differed greatly and sources of fuel and light likewise varied. The cost allowed for these items, therefore, often did not represent local conditions. Some towns had street cars and some had not; some had public libraries and some had not. The average of the cost of living in all of these towns was not, therefore, a picture of conditions in any one of them. It represents, rather, a composite of all bituminous mining towns and is an attempt to secure an aver- age which will best represent all bituminous miners' families. New York City, 1920: After the Bureau of Labor Statistics had made its estimate of the quantity and cost of the goods and services required by the family of a government employee in Washington, this budget was revised to provide a similar quantity budget for a so-called workingman's family. Its purpose was to furnish a standard for an "accurate determination of the cost of main- taining a workingman's family in health and decency, and also for the more accurate calculation of changes in the cost of living."i The workingman's family budget differed from the Washington clerical worker's budget in minor details of food and clothing which it was thought would doubtless about balance one another when measured in terms of dollars and cents. This budget has been used a number of times to determine the cost of living among specified groups of workers. That assembled by the Labor Bureau, Inc., for use of the unions in the printing trades in connection with their wage arbitration in New York in the fall of 1920 is reproduced in Table 3. This shows a total annual cost of living in New York City in November, 1920, of $2,632.68, divided as follows: for food, 33.1%; for shelter, 16.6%; for clothing, 20.1%; for fuel and light, 2.6%; for sundries, 27.6%.2 Summary: These minimum comfort budgets have as their common purpose the determination of the cost of an ideal minimum standard of living. They do not represent what workingmen's families are actually spending, but rather they set up a stand- ard of what should be spent in order to maintain life at a satis- factory level, regardless of whether the goods and services are locally available or not. There is, therefore, no assurance that families will spend for the items listed the income designated as necessary, or that their standard of living will adjust itself to the new requirements. Designated as "minimum comfort" or "minimum health and decency," they do not set forth the lowest possible standard from which all others are to be graded ^Monthly Labor Review, June, 1920, p. 1. 'Ibid., February, 1931, pp. 6i-65. 48 up but rather present an average or normal level to which workers may look forward. In this they are to be contrasted with the American minimum budgets which aim to present the minimum standard of living according to conditions actual- ly prevailing. The latter is considered the level below which no family could go without the sacrifice of something abso- lutely essential. A comparison of the minimum comfort budgets listed in Table 3 with those portraying the minimum American stand- ard indicates that in all of the former a much smaller propor- tion of the income is allowed for food and a much larger pro- portion for sundries than is the case with the latter, i The two budgets submitted by William F. Ogburn to the National War Labor Board in 1918 show this difference quite clearly. The American minimum budget, which was developed from a study of all families canvassed in the New York shipbuilding district allowed only $10 less a year for food than the budget developed from a study of expenditures by families in the higher wage groups. The difference between the estimated minimum at a cost of $1,386 annually, and the $1,760.50 annually al- lowed in the budget designated to portray a level above sub- sistence was made up largely through a difference in the allow- ance for sundries. The distribution of items in the two budgets were as follows: "Minimum "Level above minimum budget" subsistence" Food 44.4% 35.5% Shelter 13.0% 12.5% Clothing 16.9% 17.8% Fuel and light 4.4% 4.2% Sundries 21.3% 30.0% 100.0% 100.0% The difference between the distribution of expenditures by average families in Philadelphia and the distribution of the budget as allotted by the Bureau of Municipal Research in their ideal standard for Philadelphia has already been given. This also shows how much smaller was the proportion of the budget allowed for food in the ideal standard than was being spent by actual families. ^ Conclusion It is important to keep in mind the fundamental differences between the budgets developed to portray the minimum American standard of living and those which represent the mini- mum comfort standard of living. These differences may be summarized as follows: 1. The American minimum standard, whether represented ■To the minimum health and decency budgets listed in Table 3 may be added the ideal budget of the Bureau of Municipal Research of Philadelphia in 1919. See pp. 29-30 of the present report. 'See page 30 of the present report. PROPER-fV OF LIBRARY NEW yohk state %mmi i^> m u^^ BElATIOnS by estimates based on expenditures by actual families, such as are summarized in Chapter II, or on theoretical budgets such as are noted in the first part of the present chapter, aims to include the minimum requirements of health, decency and self- respect, according to conditions actually prevailing. The minimum comfort budgets, on the other hand,_ represent ideal conditions, as in the budget for bituminous mining communi- ties, without regard for their local realization. 2. The American minimum, because it is based on condi- tions actually prevailing, is one which can be realized imme- diately by those families whose incomes permit. The minimum of comfort standard, on the other hand, based as it is largely on theoretical considerations, may or may not be realized at once, depending upon the possibility of obtaining locally the goods and services called for in the budget, and upon the ease with which families are able to adapt themselves to the conditions it would make possible. 3. The American minimum is a true minimum in the sense of representing a standard below which an average family could not fall without the sacrifice of something absolutely essential and by which all other standards are to be measured; the minimum comfort budgets, on the other hand, depict a standard considerably above this and one which contains many items that could be eliminated or reduced in amount without curtailing the necessities. 4. The origin of these two standards also is different. The American minimum, as developed first in the budgets summar- ized in Chapter II, which were used also as the basis for the first estimates of the cost of living on the budgetary plan without the collection of budgets, was almost always based on a study made for the purpose of establishing general conditions and not with the idea of putting them to specific use.i The minimum comfort budgets were the direct outgrowth of labor disputes, and were devised primarily to furnish a standard for the establishment of wages. Thus, in spite of the fact that the minimum comfort budgets were frankly ideal, they were designed for practical use; earlier budgets which were based on actual conditions were abandoned because they did not meet the ideal standard. These differences between the origin and purpose of the two standards as well as their respective contents has not always been kept in mind and confusion has resulted. It is obvious, however, that there is a vast difference between a standard of living which represents the minimum American level for unskilled workers and one which establishes the ideal which average wage-earners may hope to attain. ^Except in the case of charitable societies which mi^ht use them as a standard of nor- mality and could adapt them to the requirements of mdividual families. SO IV THE TYPICAL FAMILY In Chapters I and II were presented the general findings of the most important studies of family budgets made in the United States in recent years. These include in each case a description of the purpose of the investigation and of the method used in collecting the information, the type of family studied, its average size, average income and average cost of living, the sources of its income, and the distribution of its expenditures. In Chapter III the standard of living was dis- cussed and there were given the most important estimates of the cost of living made on the budgetary plan without the collection of family budgets. These relate to the requirements of a man, his wife, and three children of school age where the father's earnings are the only source of income. In the present chapter the representative character of this family will be discussed in detail on the basis of the evidence furnished by the budgetary studies summarized in Chapters I and II. Results of a study of family budgets may be representative or they may not. Representative results are obtained when families have been selected for no purpose except their ability and willingness to supply the required information; results are not representative when families have been studied whose qualifications have been prescribed in some way so as to in- clude or to exclude certain types. If, for example, it is required in an investigation that every family from whom budgets are collected must be of a certain size, the information assembled from them sheds no light on the average size of all families; or, if the families are chosen to come within given income groups, their average cost of living is not necessarily representa- tive of the cost of living among all families; or, if their incomes are limited to certain sources, the figures collected show nothing regarding sources of income among families in general. Investigators of the standard and cost of living have from time to time limited themselves to a study of families of a certain size or income group in order to obtain a greater homo- geneity. This has usually been when it was desired to estab- lish general principles regarding income or expenditure rather than to ascertain average conditions. Such studies have, of course, a distinct place but they are not to be confused with studies of unselected families, the results of which show average conditions actually prevailing. 51 Size and Composition of the Family An illustration of the difference in results to be obtained where families are unselected and where they are chosen to meet certain requirements is found through an examination of the study made by the United States Bureau of Labor in 1901. From the total of 25,440 unselected families surveyed there were chosen all those whose composition was called normal, i.e., where there was a man at work, his wife, not more than five children and all of these under 14 years of age, and no boarders, lodgers, servants or dependents other than the children. These families numbered 11,156 or 44% of all from whom data were secured. The following tabulation shows the comparability of these selected families with all families. Unselected Selected families families Number of families 25,440 11,156 Average size 4.88 3.96 Average income per family $749.50 $650.98 Average cost of living per family $699.24 $617.80 Average cost of living per member $143.29 $157.13 This shows that while average families numbered nearly five persons per family,i those in which all children were under 14 years of age and there were no boarders, lodgers, servants or other dependents averaged not quite four. 2 It suggests, also that even though the average age among all families probably is greater than among families consisting of two par- ents and children under 14 years of age, their average per capita cost of living is less. This may be either because of the children or it may be because such families are smaller and fewer econo- mies are possible, but in either case the cost of living of such families apparently is not representative of the cost of living of all families. The families studied by R. C. Chapin in New York in 1907 were selected to meet certain requirements as to size and income. Of all the schedules collected, one-sixth were rejected because they contained less than four or more than six persons. Such *The average size of all families in the United States as reported by the Bureau of the Census was 4.5 persons in 1910. Families in this instance include all persons sharing a common abode, whether it be one person living alone or a hotel or institution. United States. Bureau of the Census. Thirteenth Census of the United States, 1910, Abstract, p- 259- _ ^Interesting evidence that in a family with several children only a small proportion will at any time average under 16 years of age is furnished by figures collected by the Metropolitan Life Insurance Company. A study of 663 families where deaths had occurred in July and August, 1920, among industrial policy holders, almost all of whom are wage- earners, indicated that there was an average of 2.4 children per family. Of these, only 34% were under_l6 years of age, or less than one child per family. In 24% of the families therewere no children at all; in 37% there were children under 16 years of age and in the remaining 39% all of the children were 16 years of age or over. Where the deceased parent was under 4s years of age and left children, the number of children under 16 years of age averaged 2.2 per family. Metropolitan Life Insurance Company. Statistical Bul- letin, October, 1920, p. 4. According to the Census of ipro, there were 20,255,555 families in the United States. There were, also, 29,499,136 children 14 years of age or under. This is an average of slightly less than 1.5 children under is per family. Of course, these were all families and all children, not wage-earners' only. There is no statistical evidence to determine how representative one is of the other. Thirteenth Census of the United States, oi>. cit,. Ab- stract, pp. 122; 259. 52 being the case, the fact that the families included in this in- vestigation averaged five persons indicates nothing as regards the size of wage-earners' families generally. Sources of Income In the federal investigation of 1918-1919, the families from whom information was obtained were selected so as to meet certain requirements as to composition and sources of income. The fact, therefore, that 89.2% of the average income was received from earnings of the father has little or no significance, since only families were scheduled in which at least 75% of the total income was earned by the father or others who turned all earnings into the family fund. Unselected families, on the other hand, show a rather differ- ent distribution of sources of income. Among the 25,440 unselected families studied by the United States Bureau of Labor in 1901, 79.49% of the average income was earned by the father; 1.47% by the mother; 9.49% by the children; 7.78% was paid by boarders and lodgers; and 1.77% came from other sources. 1 Among the unselected families in New York City studied intensively by Mrs. More in 1905, where the average number of persons was 5.6 per family, 63.5% of the total family in- come was derived from earnings of the father; 9.4% from earn- ings of the mother; 11.5% from the children; 9.2% from board- ers and lodgers; 6.4% came from other sources. Mrs. More wrote in this connection: "The popular impression, outside the working class, seems to be that the entire income of the workingman's family is from earnings of the head of the family. This implies that if the head of the family is an unskilled day laborer, the income of his family is of that grade. On the contrary, some of the largest incomes in this study are of this class. The fact is that there are comparatively few families of wage-earners who are entirely dependent on the earnings of the head of the family. This may be true in families where there are several young children, and the wife's strength is needed at home, but even then it is sur- prising how frequently other sources of income are added. "As the children grow older and require less of her care at home, the mother takes in sewing or goes out washing, secures a janitor's place, cleans offices and does whatever she can to increase the weekly income. She feels this to be her duty, and often it is necessary. . . . There are, of course, many families in which this united income is needed, when the man's illness or incapacity makes it imperative for the wife to help. Sometimes it is due to thrift and an ambition to save money for the future, or for some definite purpose. "It is the general custom for all boys and girls between 14 and 18 to bring their pay envelopes to the mother un- >Eigliteentli Annual Report of the Commissioner of Labor, ot- cit„ p. 63. 53 opened, and she has the entire disbursement of their wages. . . After they are 18, the boys usually pay board . . . and are no more expense to the family than the usual boarder. The girls are not usually boarders until they are over 21. . . . In some cases they continue to give their wages to their mother, who supports them until they are married. "All the larger families having five or more in the family have from one to five children who are adding to the family income. As the children become wage-earners the mother stays at home and does the housekeeping."^ The New York State Factory Investigating Commission found that while the average family numbered about five persons, the average number of wage-earners per family was about three. 2 The collections of budgets from other cities reveal comparable conditions. In Homestead where the family averaged 4.4 persons per family, the father was the only wage-earner in 59% of the families. The mother contributed to the support in 10% of the families, the sons contributed in 19% of the families, and 20% of the families had income from lodgers. In the families of cotton textile workers, both in the southern mill centers and in Fall River, there were several sources of income to be added to the father's earnings. Among wage-earners in the District of Columbia, where the average net family was only 3.8 persons, many families were not wholly dependent on the father's earnings, but had income from the mother, children, boarders and lodgers, and other sources. Among the Kensington mill workers, only five out of 23 families depended solely on an income provided by one wage- earner. Among the wage-earners' families studied by the Bureau of Municipal Research of Philadelphia, which averaged 5.04 persons, mothers and children frequently added something to the family income and in more than one-third of the families there were boarders or other sources of income. Even among the families in New York studied by Chapin, which were selected so as to produce approximately the average size and composition he conceived, in advance, to be normal, the father was the only source of income in fewer than half of the cases.' Such data as are available regarding sources of income indi- cate, therefore, that while among wage-earning families the 'More, of. cit., pp. 83-87. 'Report of the New York State Factory Investigating Commission, op. cit., pp. 1491- 1494. "Many other sources of information, chosen almost at random, show how studies made from other points of view than that of family budgets bring out that most wage-earners' families have other sources of income than the wages of the father. See, for example. Report on Condition of Woman and Child Wage-Earners, op. cit.. Vol. I, pp. 413-414; ibid.. Vol. II, pp. 349-350; ibid.. Vol. Ill, p. 517; ibid., Vol. IV, pp. 227-228; Laudc, W. Jett and Sydenstricker, Edgar, "Conditions of Labor in American Industries," New York, 1917, pp. 253 ff-; 357 ff. 54 ■J a eq A. m Z o w " s S o ^^ h"^ ° >< ^ w ?5 > ^<1 <^ a «' 1? - ^ <;?3 -CD »4 ^ :? O " o . ^ >< l-H k) f-H f., s o < r.f-^ W o oi & O c« OOOO-^CNt^-CSOOO IS h s b s >< r^o>ootsoo«Hro Sg 5.Ja t*i -*' Tjl lo »0 lO ^0 vo" ■^ |5 i'"^i|l *-■ O ■* « O fO 00 IN f-J cj es ri to f*3 w* -^ i?^ " o o o o o o o o |5 a f ■^i o d d d d d d d oooooooo S i „ «O0t^VJOO«'H^ 5 g s i-i^CO»Ot^COWt^ 1 O S " ■rt ^ P ii 3 (N'*'*ioo\r-.-^co SJ o CS eo lO M »0 »' N !>.' E H iH w es fo 't o >. N 2 S !> ■*«CS'*iO'*»0'0 1 1 3 rHO*Hf0^esesr>. >. 3 o 5 S - » O « fO CO -H Tt" ■*^ o la 1 « N " - -H to t^' ^' id" 00 d -H !» tH IH *-l iH 8 t W&(SiO-^iOl>00 5 d d -h' ,»; -h" ^ ^* d o 1 S oor*fO'rtOMr»_ "S ^ m c^" ^' ^ es ^" ^ o a K J* p< W^ (SOOC^t-CSOm-^J* *0(SOvO\«»-iU^'* OvO\00t^t^\OiO^ u IS P. t^csOioh-TfH'^fO sOfOf^-^fOCNtO"* »o o lo ■* cs f-i es g .s >< 1 cS *«-) >l t^ m o t* (*) 1 d ■* fO es O » ^'^ &■*©;■* 00 0) ■* »H M CM re ro ^ ^ «» 69 e» <« w ** V, ih ih m (h u t3 ^3 "d tJ t:) S rfl 1§§§§§g t^-^'dTt'd'd'O'ti o^'Oiacflflcici e»0ci]c8ciSri[i]S I-. *'ot-moi>fo a>to«T(«co ^ (0 ^ 10 CM o O) ^ 0) -* O) •* O) -* CO > — CM CM 10 to o i» v» «» <» i» «»» Q $5 o O o o o o Z o ^ H H 1- h- h 1- < oZ UJ 10 O t ro o N 10 2~ Q N- -^ o> '^ O) ^r en ^ D «» « v» S 10 (Great Britain Board of Trade) Chart 1 : Sources of Income in 3,215 Families in the United States^ Studied by the British Board of Trade in 1919, BY AvERAei Weekly Income 56 father is the principal bread-winner, there are in many families one or more other means of support. There is evidence, more- over, that the proportion contributed by the father steadily decreases as the income increases. This apparently is due to the increasing contribution of the older children. Table 4, taken from the summary of the report by the British Board of Trade on the cost of living in American townsi shows this to be the case and the results of other investigations, while not pre- senting the data in this form, are strongly corroborative. The figures in Table 4 are shown graphically in Chart 1. Table 4 also shows how close is the relation between family income, number of children at home and total number of persons per family. It furnishes additional evidence that when the family, unselected as to composition, averages five persons, the father's earnings represent about 80% of the total income, the principal other source being contributions by children 16 years of age and over. Table 5 Average Number of Persons per Family, Average Annual Income, Average Proportion of the Income Contrib- uted BY THE Father, and Average Percentage of Families Having Income From Children in the United States in 1918-1919, by Income Groups (United States Bureau of Labor Statistics) Average persons per family Percentage Percentage Number of Average annual of total income Income group Equiva- having in- families Total lent adult males mcome contributed by father come from children Under $900 332 4.3 2.89 $812.89 94.2 7.8 S 900 and under $1,200. 2,423 4.5 2.98 1,075.38 94.3 8.5 $1,200 and under $1,500. 3,959 4.7 3.16 1,343.80 93.2 12.2 $1,500 and under $1,800. 2,730 5.0 3.35 1,631.54 91.2 19.2 $1,800 and under $2,100. 1,594 5.2 3.62 1,924.87 87.9 27.3 $2,100 and under $2,500. 705 5.7 4.09 2,272.18 78.6 46.2 $2,500 and over 353 6.4 4.95 2,790.25 64.4 71.1 Total 12,096 4.9 3.33 $1,513.29 89.2 18.6 These same facts are suggested, although the analysis is not made in this form, by the figures collected by the United States Bureau of Labor Statistics in 1918-1919.2 The average size of all families was 4.9 persons. Their average yearly income was ?1,513.29. When, however, these families are •United States. Bureau of Labor. Bulletin No. 93, p- S4i- This is a summary of tables on pp. XIV-XLVII of the British Board of Trade Report on the Cost of Living in American Towns, op. cit., in which incomes are given in pounds, shillings and pence. ^Monthly Labor Review, December, 1919, PP- 29-41. S7 grouped according to income, it appears that their average size varies almost directly with income. The proportion of the total family income contributed by the father decreased while the proportion of families having children at work steadily increased with growth of family income. Details cf this are shown in Table 5, and the relationships between size of family, sources of income and amount of income are shown graphically in Chart 2. PERCENTAGE OF TOTAL fNCOME CONTPIBUTED BY FATHER PERCENTAGE OF FAMILIES HAVING INCOME FROM CHILDREN UNDER » 900 $ 900 TO $1,200 (United States Bureau of Labor Statistics) Chart 2: Average Proportion of the Income Contrib- uted BY the Father, and Average Percentage of Families Having Income from Children, Among 12,096 White Fam- ilies IN the United States, Studied by the United States Bureau of Labor Statistics in 1918-1919, by Income Groups Few of the local investigations of family budgets deal with this phase of the problem. Chapin's study suggests that an increase in family income brings a correspondingly smaller proportion as the father's contribution, although the number of 58 families in some income groups is too small to warrant final conclusions.! Kennedy's 9,nalysis of conditions among em- ployees in the stockyards shows that an increase in the size of the family nearly always meant an increase in average yearly income. 2 StreightofF found in his investigation for the New York State Factory Investigating Commission that as the size of the family increased the number of wage-earners in the family increased also.' Conclusion From the above analysis the following conclusions may be drawn : 1. American workingmen's families average about five per- sons per family, including boarders, lodgers and servants. If there are chosen only those families in which the father is the sole wage-earner and all children are under 14 years of age, the average size is apparently four or less per family. 2. Where families average five or more persons there is more than one wage-earner, and the proportion of the income contributed by the father of the family steadily decreases with the increase in the average size of the family. 3. Two types of family seem to be more representative of all wage-earners' families than that which consists of a man, wife, and three children under 14 years of age. These are: (a) a family of five in which there are sources of income in addition to the wages of the father, or, {&) a family of four with one wage-earner. 'Chapin, of. ctl., pp. ST, 63-64. 'Kennedy, op. cit., pp. 62-67. •Report of the New York State Factory Investigating Commission, of, cit., p. 1491. 59 INCOMES AND EXPENDITURES Distribution of Income to the Principal Budget Items The proportion of the total expendituresfor the cost of living allotted to different items in the family budget has always been regarded as evidence of the economic status of wage- earners' families. An inspection of Table 1 and Table 2 indicates that prior to the World War, from 40% to 45% of the total family expenditures normally went for food; 10% to 15% was spent for clothing; 4% or 5% for fuel and light; rents averaged 15% to 20% and the cost of sundries from 18% to 23%. Apparently the average of families studied by the Bureau of Labor in 1900-1902 is as fair a representation as any. Among the 11,156 "normal" families, and the 2,567 chosen only because they could give the information, expenditures were allocated as follows: Budget items Food Shelter Clothing Fuel and light. Sundries Percentage distribution of budget by — 11,156 2,567 ■'normal" unselected families families 43.13 42.54 18.12 14.53 12.95 14.04 5.69 5.25 20.11 23.64 This study by the Bureau of Labor showed, however, that these distributions were not characteristic of all families but that diff'erences in the total amount spent caused differences in the percentage of the total allocated to diff"erent items. A careful analysis of conditions among the 11,156 families where all children were under 14 years of age and there were no board- ers, lodgers, servants or other dependents illustrates this. In Table 6 are shown changes in the percentage of the total ex- penditures allocated by these families to the diff'erent budget Items. The families are arranged by Income groups. This table indicates that the proportion spent for food and for fuel decreased, while the proportion spent for clothing and for sun- dries increased with an increase in total expenditures. The proportion spent for rents and for light varied only slightly with a change in total expenditures. These relationships held for families of all sizes included, i 'Eighteenth Annual Report of the Commissioner of Labor, op. cil., pp. 584-585. 60 Table 6 Percentage of Total Yearly Expenditure for Each of THE Major Items in the Budgets of 11,156 "Normal" Families in the United States in 1900-1902, by Classi- fied Income (United States Bureau of Labor) Total fam- ilies Percentage of total expenditures for- - Income group Food Shel- ter Cloth- ing Fuel Light Sun- dries All items Income under $200 32 50.85 16.93 8.68 6.69 1.27 15.58 100.00 Income $200 or imder $300 115 47.33 18.02 8.66 6.09 1,13 18.77 100.00 Income $300 or under $400 545 48.09 18.69 10.02 5.97 1.14 16.09 100.00 Income $400 or under $500 1,676 46.88 18.57 11.39 5.54 1 17. 16.50 100.00 Income $500 or under $600 2,264 46.16 18.43 11.98 5.09 1 12 17.22 100.00 Income $600 or under $700 2,336 43.48 18.48 12.88 4.65 1 17. 19.39 100.00 Income $700 or under $800 2,094 41.44 18.17 13.50 4.14 1 17 21.63 100.00 Income $800 or under $900 806 41.37 17.07 13.57 3.87 1 10 23.02 100.00 Income $900 or under $1,000. . . 684 39.90 17.58 14.35 3.85 1.11 23.21 100.00 Income $1,000 or under $1,100. 340 38.79 17.53 15.06 3.77 1 16 23.69 100.00 Income $1,100 or under $1,200. 96 37.68 16.59 14.89 3.63 1.08 26.13 100.00 168 36.45 17.40 15.72 3.85 1.18 25.40 100.00 11,156 43.13 18.12 12.95 4.57 1.12 20.11 100.00 How 12,096 white J 'amili( 5S, wi th no boarders or] odgers and where the father was the principal wage-earner, distributed their incomes in 1918-1919, is shown in Table 7. Very much the same relationships with changes in incomes obtained among expenditures for the separate items in the family budget in 1918-1919 as had been found in 1900-1902. The proportions spent for food, for fuel and light and for shelter decreased as income increased; the proportions spent for clothing and for sundries increased with an increase in income, i These facts, which applied to families of every size, are shown graphically in Charts 3 and'4. 4VEDAGE ANNUAL INCOME UNDER $SQO $ZDQ TO «3D0 ♦300 TD 1400 iAOa TD »50D $500 TD SGOD teoo TO »70D J7D0 TD $SOD «B00 TD «90D «9oa TD $1,000 ji.oaa TD $1,ID0 (1,100 TD $1,200 $1,200 AND QVEO SHELTER ING FUElI SUNDRIES .V5a:A 'V,«.**!*V3 5.3" 5.1 21.3 100.00 '^ Not including 1 family in which rent is combined with fuel and light. "Not ■= Not "Not « Not ' Not K Not "Not 44 families in which rent is combined with fuel and light. 91 78 51 21 9 295 The study by the British Board of Trade among American wage-earners in 1909 also indicated that as income increased, the proportion spent for food and shelter steadily decreased, so that while among families in the lowest income group 70.92% went for these two items, among families in the highest income group, only 38.31% went for these items. The average was slightly more than 53%. i AVERAGE ANNUAL INCOME UNDER $SQO «SDD TO * i,aoo * 1,200 TO « 1,500 41.500 TO tl.aOD «l,BOO TO «e,IDO «e,IOO TO $8,500 »S,SOQ AND OVER runNiTURt MISC. 10.5 m-i.'^wmmatmm (United States Bureau of Labor Statistics) "'^ Chart 4: Percentage of Total Yearly Expenditures FOR Each of the Major Items in the Budgets of 12,096 White Families in the United States, Studied by the United States Bureau of Labor Statistics in 1918-1919, by Income Groups 'British Board of Trade, ot. cil., p. XLVIX. 62 The local studies i in which such an analysis was made also bear out these conclusions which may be summarized as fol- lows: First: The greater the total expenditure, the smaller the proportion spent for food. Second: The greater the total expenditure, the larger the proportion spent for clothing and for sundries. Third: The proportion spent for shelter and for fuel and light tends to decrease slightly, with an increase in total expenditure. These generalizations regarding expenditures by American wage-earners' families are to be compared with Engel's so- called "laws," formulated in 1857 after a study of expenditures by Belgian and Saxon working class families. These laws are: First: The greater the income, the smaller the percentage of outlay for subsistence. Second: The percentage of outlay for clothing is approximately thq same, whatever the income. Third: The percentage for lodging or rent, and for fuel and lighting is invariably the same, whatever the income. Fourth: As the income increases in amount, the percentage of outlay for sundries becomes greater. 2 Engel regarded the proportion of the total expenditure which was spent for food as a sure indication of the material prosperity of a people. This principle has usually been accepted as of application to the families of American workmen, and it is gen- erally held that the smaller the proportion of the total expendi- ture necessarily spent for food, shelter, fuel and light, with consequently more available for clothing and sundries, the higher is likely to be the standard of living. Income in Relation to Expenditure, 1901 and 1918 Most American studies show that among average families there is normally a surplus of income over necessary expendi- tures. In the federal investigation of 1901 this surplus was 6.71% of the total income;^ in 1918 the average surplus was 5.19%.* In both of these studies there were families which had a deficit, and families whose incomes and expenditures exactly balanced, as well as those which had a surplus. The general average indicates surplus rather than deficit. An interesting question frequently raised in connection with these studies of family budgets is whether the general average standard of living tends towards a higher level or whether the ^Byington, op. cit., p. 68; Bureau of Municipal Research of Philadelphia, op. cii., p. 35, ^Engel, Ernst, quoted in Eighteenth Annual Report of the Commissioner of Labor, op. cit., p. loi. 'Eighteenth Annual Report of the Commissioner of Labor, op. oil., p. 67. ^Monthly Labor Review, August, 1919, p- 118. 63 reverse is true. Royal Meeker, formerly United States Com- missioner of Labor Statistics, was of the opinion that families in 1918 were not living so well as they had been before the war.i This conclusion he based on a study of food c onsumed by fam- ilies in selected areas in 1901 and in 1918, which seemed to indi- cate that "a net loss in the richness or calorie content of the diet has probably taken place. Unfortunately," however, "the 1901 budget is so lacking in detail we cannot estimate its calorie value. "^ Food, moreover, is only one item in the family budget, for which about two-fifths of the total average expendi- tures are ordinarily allowed. A more accurate picture of the relative standard of living in 1901 and 1918 would be obtained by comparing the proportions in which families allotted their expenditures in the two years.' This is somewhat difficult, however, because the cost of living increased within the period and the average cost of each item did not increase at the same rate. If the standard of living had remained the same and the cost of each item had changed simultaneously at the same rate, or if there had been no change in the cost of living, the average expenditure for each item in 1918 would bear the same relation to the total as it did in 1901. If on the other hand, the cost of all items had changed at the same rate, or if there had been no change in the cost of living, and a smaller proportion were being spent for food and a larger proportion for clothing and for sundries in 1918 than in 1901, it could fairly be assumed that conditions had improved, and that the standard of living was higher in 1918 than it had been in 1901. And if, vice-versa, more, proportionately, were being spent for food, and less for sundries, the conclusion would be justified that families were worse off in 1918 than they had been in 1901. By comparing Table 6 and Table 7, it appears that in 1918 a smaller proportion of the total was being expended for food and for shelter, and a larger proportion for clothing and for sundries than was the case in 1901. The proportion spent for fuel and light was about the same in both years. In order to determine the extent to which these changed proportions represent a change in the standard of living, it is necessary to compare changes in actual expenditures with changes in the cost of living. If expenditures for each item and for all combined had increased more than the increase in the cost of each item and of all items combined, it would be fair to assume that the families had relatively more to spend in 1918 than in 1901; and the reverse also is a fair assumption. ^Monthly Labor Review, July. 1920, pp. l-io. 'Ibid., p. 9. The budgets compared were those collected by the United States Bureau of Labor Statistics in 1900-1902 and in 1918-1919. 'There_ is no way of determining the comparability of the age and composition of the families in 1900-1902 with those in 1918-1919, but from the method of their selection they cannot be very dissimilar. 64 The actual expenditures of these families increased 132.2% between 1901 and 1918. Expenditures for food increased 105.8%; for shelter, 70.9%; for clothing, 195.8%; for fuel and light, 64.8%; and for sundries, 70.5%.i To estimate the increase in the cost of living within this same period is not so simple, inasmuch as figures are not availa- ble to show the increased cost since 1901 for any article in the budget except food 2. The retail food price index numbers of the United States Bureau of Labor Statistics show that be- tween 1901 and 1918 retail food prices increased 154.4%.' Although there are no figures to show changes in the retail cost of the other items in the family budget within this period for the United States as a whole, estimates are available for the state of Massachusetts which make possible a comparison of the price level of 1901 with that of 1918, in that state. These figures show that the cost of living among wage-earners in Massachusetts increased 20.5% between 1901 and 1910, as follows:^ Food 30% Fuel and light 14% Shelter 12% Sundries 10% Clothing 20% All items 20 . S% Between January, 1910, and the end of 1918, the increased cost of living in Massachusetts was 73%, itemized as follows :5 Food 93.1% Fuelandlight 44.5% Shelter 27.9% Sundries SS.0% Clothing 109.6% All items 72. 8% The total increase in the cost of living in Massachusetts between 1901 and the end of 1918 was, therefore, 107%, itemized as follows: Food 151.0% Fuelandlight 64.7% Shelter 43.2% Sundries 70.5% Clothing 151.5% All items 108.2% These figures, being for Massachusetts, must be corrected so far as possible to apply to the country as a whole. While this cannot be done with absolute accuracy, a fair idea of the 'Eighteenth Annual Report of the Commissioner of Labor, of. cit., p. 583; Monthly Labor Review, August, 1919, p. 118. 'The United States Bureau of Labor Statistics has collected prices of coal and of gas since 1907, and prices of a few cotton yard goods since 1915. "Increases in food prices in the United States within this period may be obtained in various ways from data suppHed by the United States Bureau of Labor Statistics. The method used here has been to ascertain the increase between average prices in 1901 and prices in October, 1913 (57.5%). as shown by index numbers based on average prices in 1890-1899, to which was added the increase between October, 1913, and the average for the year 1918 (61. S%), based on average prices in I9I3- United States. Bureau of Labor Statistics. Bulletin Number 138, "Retail Prices 1890 to October, 1913;" Hid., Monthly Labor Review, July, 1920, pp. 71-72- ^ «Massachiisetts. Report on the Cost of Living, of. cit., p. 72. 'The weights used in combining the increases for the separate items were very slightly different on the two dates, but the effect on the total is not important. Massachusetts. Commission on the Necessaries of Life. Report, February, 1920, p. n8 ff. 65 difference between the two may be obtained. During the period 1914 to 1918 the increase in the total cost of living shown by the Massachusetts figures averaged about 2% less than that shown by the figures of the National Industrial Conference Board for the country as a whole. The difference between the food price increase for the country as a whole between 1901 and 1918 (154.4%) and that for Massachusetts (151%) within the same period was also about 2%. If it be assumed that from 1901 to 1918 a proportionate difference oc- curred between figures for Massachusetts and figures for the entire United States, the increase in the cost of living for the country as a whole between 1901 and 1918 averaged in the neighborhood of 110%. This is to be compared with an increase of 132.2% in actual expenditures by representative families within the period. Increases in expenditures for the separate items in the United States and increases in actual cost of the items in Massa- chusetts between 1901 and 1918 are shown in the tabulation below: Increases Increases in expenditures in cost of in the United living in States, Massachusetts 1901-1918 1901-191S 105. 8% 151.0% 70.9% 43.2% 195.8% 151.5% 116.7% 64.8% 205.2% 70.5% 132.2% 108.2% Food Shelter Clothing Fuel and light Sundries All items This shows a difference of 22% between increases in expendi- tures in the United States and increases in the cost of living in Massachusetts, between 1901 and 1918. Even though the cost of living in the country as a whole had increased consider- ably more than in Massachusetts, it is not probable that it approached 132%, which represents increases in expenditures.! Since expenditures for living had increased more than the cost of living, it is evident that a higher standard was being main- tained in 1918 than in 1901. Other evidence pointing in this direction is the fact that while the average cost of food and of clothing each advanced 151% between 1901 and 1918 in Massachusetts, expenditures for food in the United States increased only 106% while ex- penditures for clothing increased 196%. Thus, while food in 1901 required 43% of the total family budget, in 1918 it re- quired only 38%; and clothing, which in 1901 took only 13% iLauck, for example, placed the advance between 1906 and May, 1920, at 110%. (Before the United States Anthracite Coal Commission. Employes Exhibit No. 20, "What a Living Wage Should Be," p. 4). The increase during 1919 and the first five months of 1920 was probably in the neighborhood of 20% while between 1901 and 1906 it was probably not so much as this. 66 of the budget, in 1918 consumed 16.6%. Rent and fuel and light likewise required a smaller part of the budget in 1918 than in 1901. These circumstances seem to indicate that in 1918 there was a greater margin between necessary expendi- dures and opportunity for indulging in certain luxuries such as may be exemplified by increased expenditures for clothing. Average expenditures for sundries likewise increased much more in the United States than the increase in their average cost in Massachusetts, i.e., 205.2% as against 70.5%, and sundries took up a larger share of the budget, 26.4%, in 1918, than in 1901, 20.1%. Increases in expenditures for rent and for fuel and light greater than the increase in the cost of either seems to indicate a rise in standard, even though the propor- tion of the budget which they required was greater in 1901 than in 1918. Comparative expenditures in 1900-1902, and in 1918-1919 are shown graphically in Chart 5. 1900-1902 I9I8-I9I9 (United States Bureau of Labor Statistics) Chart 5 : Percentage of Total Yearly Expenditures Allotted to Each of the Major Items in the Family Budgets of Average Wage-earners' Families in the United States, Studied by the United States Bureau of Labor Statistics in 1900-1902 and 1918-1919 These circumstances strongly indicate, although the data are too meager to warrant definite conclusions, that American workingmen's families were maintaining a higher standard of living in 1918 than they were in 1901. 67 Conclusion These studies of family budgets seem to warrant the follow- ing conclusions: 1. As the average amount expended for the cost of living increases, the proportion of the total spent for food decreases, the proportion spent for clothing and for sundries increases, while the proportion spent for shelter and for fuel and light tends to remain about the same. 2. An exact comparison of the average standard and the average cost of living among American wage-earners' families in 1900-1902 can not be made with that in 1918-1919, because of incomplete data. Such evidence as is available, however, suggests that in the later years families were no worse off and probably were better off than they had been in the earlier period. 3. The budgets collected from small groups of families in different locahties confirm in detail the findings of the larger in- vestigations for the country as a whole and illuminate them at many points. They indicate that a wide variety of conditions affect family life in the localities surveyed, both as regards standard of living and its cost. Opportunities for the employ- ment of men, women and children, the level of wages paid, the racial and social standards of the people themselves as well as the types of houses available, character of schools provided, recreational opportunities and the like all have their influence. No two communities are alike; no two groups of families studied are identieal. Each may be representative of the class it pur- ports to represent, but it can scarcely be said to do other than that, except in the broad ways already indicated. 4. Many of these studies conclude with estimates as to the sum needed to maintain a family at a fair minimum standard of living. These estimates were for the most part based on the requirements of families of five persons, but the sources of in- come from which expenditures were to be met were not specified. Sometimes the estimated cost of living was related to a family arbitrarily assumed to consist of two adults and three non-wage- earning children. To the extent that this estimate is regarded as an indication of the cost of living of families of a given size and composition it has a certain interest. In so far as it is re- garded as the minimum cost of living of wage-earners' families in general it is erroneous, because such a family is not truly representative of average wage-earners' families and its cost of living can not, therefore, be considered typical. 68 VI GENERAL CONCLUSIONS In the preceding chapters have been analyzed the most important studies of family budgets of wage-earners made in the United States, beginning with that by the United States Bureau of Labor in 1900-1902. From this analysis, the following conclusions appear justified. History and Method of Budget Studies The standard and cost of living have been established on the budgetary plan in four different ways and in the following chronological order in this country: 1. Budgets of incomes and expenditures have been collected from a large number of families and averages of these have been taken as representing average incomes and average necessary expenditures. 2. Budgets of incomes and expenditures have been collected, averages of these have been found and on the basis of these, together with objective tests of adequacy of the standard of living maintained by these families, an estimate of the minimum cost of maintaining a fair standard has been made. 3. Budgets of incomes and expenditures have been collected from a few families supposed to represent their class; each family's budget has been analyzed separately, and from a study of these and by objective tests a standard of normality has been developed and the cost of maintaining it has been estimated. 4. On the basis of the preceding three methods of establishing the minimum standard and cost of living, a theoretical budget has been drawn up for a theoretical family, designed to provide for the requirements of a fair standard of living. The goods and services listed in the budget have then been priced in the community studied, and the content and cost of the standard have thus been determined. From the above classification of methods it appears that in making cost of living studies the first step was to ascertain the actual average cost of living of a given group of families without reference to the adequacy of the standard which was maintained. The most important studies made in the United States ac- cording to this plan were summarized in Chapter I of the pres- 69 ent report. They all refer to conditions in the country as a whole. 1 The next step in the development of budgetary studies of the cost of living involves the establishment of the minimum standard and its cost. This has been derived from a study of expenditures by actual families and an intimate acquaintance with the standard they were able to maintain for the money spent. These studies have all been local in scope and are summarized in Chapter II. The last step in the development of budget study methodology has been the construction of theoretical budgets for theoretical families and the collection of prices of the goods and services listed therein. This has involved, of course, a determination of the standard of living, the cost of which is to be ascertained, and the type of family whose cost of living is thus to be meas- ured. A summary of the more important budgets constructed in this way, together with a discussion of the standard of living portrayed are presented in Chapter III of the present report. Purpose of Budget Studies Prior to the war, studies of family budgets had not been used in this country as evidence in the adjustment of wage rates. They had been made largely as matters of general sociological interest to define the standard of living and to determine its cost among American workmen in general or among groups of workmen in specified localities. The effort in these early studies was to picture actual condi- tions through the establishment of averages, or to determine a satisfactory minimum standard and its cost which could be attained with facilities already available. They therefore either reflected the existing standard and cost of living directly or they established the minimum for a given group in a given locality on the basis of the goods and services used by, and available for, the families studied. With the increased cost of living during the World War, interest in this problem among wage-earners produced a new set of budgetary studies. Since 1915, the most important purpose for which budgetary studies have been made has been to supply evidence for use in wage disputes. While in some of these an attempt was made to follow the methods and standards of the older investigations, the use of family budgets as evidence in wage arbitrations brought into existence a new method of estimating the cost of living and a new conception of the standard which should be taken as its measure. 'The study of the cost of living among wage-earners in the District of Columbia made in 1916 by the United States Bureau of Labor Statistics also belongs in this group, but being based on a local rather than a country-wide investigation, it is summarized in Chap- ter II. 70 Incomes and expenditures were not collected from wage- earners' families or, if they were, little attention was paid to these data in formulating the standard of living and its cost. Instead, a family of five, with the ages of three children arbi- trarily assumed to be under 14 years, was taken as "typical" of the American wage-earner. For this purely theoretical family different investigators constructed budgets of what they conceived to be the content of a fair standard of living. Al- though data were sometimes collected to show what families actually spent, average conditions were not used as the basis for the theoretical budgets. Instead, conclusions were based on expenditures of selected families who met the requirements as to goods and services said by domestic science experts and others to be required for a family of five persons. For a num- ber of these later estimates of the cost of living, expenditures of actual families were not collected at all. In many of these theoretical budgets food required a considerably smaller pro- portion and clothing and sundries a proportionately larger share of the total expenditures than had been allotted in the earlier standard which was discarded. In making up these budgets the artificiality of the family of five usually chosen as representative of the responsibilities of average adult male wage-earners has not been recognized. Studies of conditions among groups of wage-earners' families large and small in all sections of the country indicate that families average approximately five persons, but that three of these are likely to be over 14 years of age and that at least two contribute to the family income. In families where the father's earnings are the only source of income and the children are under 14 years of age, the latter are apt to average two rather than three as is customarily assumed to be the case. If, therefore, the cost of living of a family is to be taken as a measure of the responsibility of adult male wage-earners, it appears that this family is to be assumed to average four rather than five persons. Even then, there may be other sources of income than the earnings of the father of the family, but these supplementary sources are not so important as in the case of the family of five, where the earnings of the father have been found to average about 80% of the total income. Use of Budget Studies These newer budgets prepared for wage arbitrations were not put forward as a picture of the prevailing standard and cost of living but as an indication of what wage-earners' families ought to have if the investigator's ideals could be reahzed. The principal point of difference, therefore, between the earlier budgets, which were made as matters of general sociological interest, and the war-period budgets developed for use in wage arbitrations is that the former for the most part were a reflection 71 of conditions as they actually existed among the various groups of families studied while the latter were 'purely artificial both as to type of family considered and standard of living formu- lated. This difference between the two standards has generally not been understood and the ideal standard and cost has fre- quently been interpreted as the actual standard and cost. By whatever method budgetary studies are made, it is en- tirely possible to obtain an adequate picture of the standard and cost of living of families of a given type in a given place at a given time. So long as' these are understood to be general-" ized pictures of average conditions, which can be used as a measuring unit for individual cases, but are not regarded as a description of conditions in any one family, the method of esti- mating the cost of living on the budgetary plan has been generally accepted. It should be borne in mind, however, when family budgets are used in wage arbitrations as a measure of the cost of living, that the standard of living must be clearly defined in order that there may be no uncertainty as to whether the actual cost of living or the theoretical cost of living is intended. The tpye of family to which this cost applies should be noted, also, in order that there may be no misunderstanding as to the representativeness of the unit which has been chosen, and that it may be known whether prevailing conditions are reflected or the investigator's ideas of the make-up of the average American wage-earner's family. 72 VII THE COST OF LIVING AND WAGE ADJUSTMENTS As noted in the foregoing report on family budgets of Amer- ican wage-earners, the immediate reason for the development of family budgets during and since the war was the desire to use them as a measure of the cost of living in adjusting wage rates. In the present chapter will be outlined very briefly the development of the use of family budgets in wage arbitrations in the United States. This general outline is included because of the prominence recently given the cost of living in wage adjustments. It does not aim at historical completeness, but deals only with the most important wage arbitrations of the past few years. There is, moreover, no intention of passing judgment on the principles involved in this use of family budgets. 1 Up to 1915, budgets of the cost of living for wage-earners' families had not received recognition in this country as a fun- damental consideration in connection with the establishment and adjustment of wages. While the cost of living had been the basis on which women's wages were fixed in those states where wages are regulated by minimum wage laws, until the war this procedure had seldom been definitely related to the wages of men. Earliest Use of Family Budgets in Wage Adjustments The first use of family budgets in relation to the establish- ment of wages was more or less a coincidence. The Bureau of Standards of the New York City Board of Estimate and Apportionment had been working on a family budget which should most properly represent the needs of unskilled laborers in the city. At the same time the salary scale for street cleaners was being revised and the completed budget, showing the cost of living for an unskilled laborer's family, was submitted as a measure of necessary wages. As a result of this, street cleaners' wages were raised so that the maximum salary approached the minimum cost of living as outlined in the report.^ Two years later, in February, 1917, in connection with the question of readjusting salaries of city employees in Dallas^ 'For a criticism of certain uses to which family budgets have been put in recent wage arbitrations see article by Stecker, Margaret Loomis, "Family Budgets and Wages," American Economic Review, September, 1921, PP- 447-465- 'Report on the Cost of Living for an Unskilled Laborer's Family in New York City, op. cil., p. s; Report on the Increased Cost of Living for an Unskilled Laborer's Family in New York City, op. cit., pp. S-7- For budget, see pp. 38-39 of the present report. 73 Texas, another study of the cost of living was made for the purpose of obtaining a proper basis for "determining what wage advance to city employees might be justified. "i These two studies, which, in each instance, were instituted by the city government because of a .desire to obtain a fair basis for the adjustment of wage rates paid to municipal em- ployees, were based on conditions actually prevailing. Thus the New York budget was drawn up and prices were obtained after careful study of the size of families of unskilled laborers in New York's street cleaning department, their budgetary habits and the places where their purchases were made. Simi- larly, in Dallas, expenditures by fifty actual families were studied and formed the basis for the estimated cost of maintaining a family of five in the spring of 1917. Therefore, in submitting these budgets in New York and in Dallas, respectively, to be used as a measure of wages, the intent was to indicate the minimum cost of living for wage- earners in those two cities, according to conditions as they actually existed. Shipbuilding Cases, 1917 In 1917, the continued rise in the cost of living made it necessary to take this circumstance into account in adjusting the wages of employees in the various war industries. At that time there were no satisfactory data available by which to mea- sure the rise in the cost of living, and investigations were there- fore undertaken for the purpose of collecting the necessary information. The first studies specifically for this purpose were made by the Shipbuilding Labor Adjustment Board of the Emergency Fleet Corporation in 1917. The details of the investigation made on the Pacific Coast in connection with disturbances among the shipyard workers in Seattle, Portland and San Fran- cisco have not been published, beyond their citation in the report of the Railroad Wage Commission. 2 This was followed by more extensive studies in shipbuilding districts on the Atlantic Coast, the Gulf of Mexico, the Great Lakes and again on the Pacific Coast.' Interest at that time centered in securing information regard- ing the percentage of increase since the pre-war period in the cost of living in the difl^erent shipbuilding centers, rather than in the determination of the cost of maintaining a fair minimum standard of living. Hence, although budgets of expenditures in 1917 were collected from individual families, they were so ^Report of the Dallas Wage Commission, op. cit., p. 2. For budget, see p. 28 of the present report. ^Report of the Railroad Wage Commission, op. ctt., p. 87. 'Monthly Review of the U. S. Bureau of Labor Statistics, March, 1918, and succeeding months. For budgets, see Appendix ,4 of the present report, 74 analyzed as to bring out primarily the actual cost of the major items for the purpose of weighting increases since 1914. These budgets showed the actual average cost of living of real families in 1917. Prices of the items entering into their budgets were collected from time to time in the stores at which these families traded, and thus an estimate of the increase in the cost of living for each locality separately was obtained. These percentages of increase were used by the Shipbuilding Labor Adjustment Board in adjusting wage rates where there had been a "general and material increase in the cost of living." i The budgets were not used for the purpose of establishing a standard for a minimum wage. The budgets collected by the Railroad Wage Commission in 1918 were likewise used as a measure of increases in the cost of living since 1915 and not as a measure of the standard of living or its cost in 1917. As was noted in the commission's report: "A sufficient increase should be given to maintain that standard of living which had prevailed in the pre-war period." 2 Early Street Railway Cases, 1917 On the other hand, in two street railway cases, decided by boards of arbitration in 1917, family budgets were considered in the settlement of the disputes, and wage rates were established to meet the actual cost of living as thus determined. In San Francisco, Jessica B. Peixotto submitted her budget to the board which was arbitrating the wage dispute between the con- ductors of the Key Route System in Alameda County, Cali- fornia, and the company. In Seattle, evidence designed to show how much it cost a family of five persons to live was in- troduced by the employees and by the company, and finally a special investigation was made for the board of arbitration by William F. Ogburn and other members of the faculty and stu- dents of the University of Washington. The wage decisions in both cases were rendered on the basis of the budgets thus sub- mitted. 3 So far as can be ascertained, these budgets of Peixotto and Ogburn, based on the requirements of skilled workmen's families, are the first which ever attempted to establish this standard as a minimum by which the adequacy of wages for American workmen was to be measured. 'See, for example, United States. Shipbuilding Labor Adjustment Board,"Decision as to Wages, Hours, and Other Conditions in Atlantic Coast, Gulf, and Great Lakes Shipyards," October I, 1918, pp. 1-6; ibid., in Pacific Coast Shipyards, same date. ^Report of the Railroad Wage Commission, op. ciu, p. 16. For budget, see pp. 9-10 of the present report. >For budgets, see pp. 42-44 of the present report. 75 Cases before the National War Labor Board, 1918-1919i The principle of having wages at least keep pace with the ris- ing cost of living and of securing the payment of a living wage found general acceptance during the war, not only where the government itself was the employer but also, to a large extent, in private industry. As already noted, the Emergency Fleet Corporation and the Railroad Administration based their wage awards on increases in the cost of living. When the National War Labor Board was created in the spring of 1918, to handle disputes in private in- dustry, greater prominence was given to the theory of a living wage. This principle was incorporated in the Board's state- ment of policies as follows : "The Living Wage. "1. The right of all workers, including common laborers, to a living wage is hereby declared. "2. In fixing wages, minimum rates of pay shall be established which will insure the subsistence of the worker and his family in health and reasonable comfort." During the term of the Board's activities, 1,106 out of 1,257 complaints presented to it for settlement included demands for wage adjustments. Soon after its organization the labor members of the Board attempted to have the Board declare that a given amount of money was a measure of the minimum cost of living, but the employer members refused to consent to this on the ground that no one sum would be of general appli- cation because of local differences in requirements of families of the same relative economic and social status. The first important wage case decided by the Board was con- cerned with a demand by employees of a number of companies in Waynesboro, Pa., for increased wages. 2 The section of the Board which heard the case agreed that the rate demanded was too low to provide a living wage, but as to what a living wage should be, it could not agree. There were no recently col- lected figures to suggest what was the minimum cost of living, and at the meeting of the Board on July 12, 1918, the day following the Waynesboro award, as finally made, the Board requested its secretary to submit a statement embodying available information dealing with the minimum wage and the increased cost of living, which might be used as a guide for the settlement of disputes where this question was involved. ' Two weeks later, the living wage was made a special order of the Board's business. Joint Chairman Frank P. Walsh, of ^Unless other citations of sources are given, the information regarding the work of the National War Labor Board is derived from manuscript reports in the possession of the National Industrial Conference Board. IJnited States. National War Labor Board. Docket No. 40, "Findings in re Employees Versus Frick Company, Emerson-Brantingham Company, Landis Tool Company, Landis Machine Company, Bostwick-Lyons Bronze Company, Shearer Machine Company, Victor Tool Company, and Cashman Tool Company, Waynesboro, Pa." Washington, 1918. •Memorandum on the Minimum Wage and Increased Cost of Living, of. cit, 76 the labor group, introduced a resolution "that, without fixing the minimum wage in any particular industry, the National War Labor Board declares that, with variances as to particular localities, the living wage at this time is the sum of $1,760.50." This was the cost of maintaining the level above the minimum of subsistence budget noted on page 44 of the present report. This proposal produced a debate which lasted for a week. The labor group contended for the establishment of a given sum as the minimum wage; the employer group urged its impracti- cability. As a way out of a situation which seemed to indicate to the country that the Board was in total disharmony. Joint Chairman William H. Taft, of the employer group, presented a resolution which was adopted by the Board on July 31, 1918, to the effect that neither side would take advantage of the war- time urgency to further policies which, although based on approved views of progress in normal times, "under war con- ditions, might seriously impair the present economic structure of our country; that the declaration of our principles as to the living wage and an established minimum should be construed in the light of these considerations; that for the present the Board or its sections should consider and decide each case in- volving these principles on its particular facts and reserve any definite rule of decision until its judgments have been suffi- ciently numerous and their operation sufficiently clear to make generalizations safe." Although the National War Labor Board never declared a given sum of money to be the generally acceptable measure of a living wage, a large number of cases decided by sections of the Board seem to have been based on the lower of the two family budgets submitted to it in July, 1918. i Almost immediately after the Board refused to commit itsdf to a given sum of money as a generally applicable measure of the minimum cost of living, the Board's cost of living division, in co-operation with the United States Bureau of Labor Statistics began a nation-wide survey of the cost of living. Ninety-two localities in 42 states were canvassed, 2 and the data that were thus collected served as the basis for some of the Board's later wage adjustments. The National War Labor Board decided its last cases m August, 1919, but although the employer group regarded the statement of principles in the light of a working arrangement for the war period only, the influence of the Board's policy in recognizing a relationship between the cost of living and wages has been apparent in most wage arbitrations that have since taken place. Those of which the public has heard most are the street railway cases, the cases coming before the United States Rail- road Labor Board, the anthracite and bituminous miners' cases 'See p. 40 of the present report. 'See pp. 10-12; 90-97 of the present report. before special presidential commissions, and the cases of the packing-house employees decided by a federal administrator. Private negotiations in the printing trades, the clothing trades and other industries, where systems of voluntary arbitration prevail, have also made use of family budgets to greater or Jesser extent. Later Street Railway Cases, 1919-1921 The National War Labor Board, during its first 13 months considered 156 street railway cases, and rendered 89 awards, i Most of the terms thus arranged were to run for the duration of the war or for some other given period of time, or in other ways were subject to review and readjustment at a later date. Some of these awards were later reconsidered by the Board; many of them were due for reconsideration after the Board had gone out of existence and the issues involved were left to private agencies for arbitration. The street railway employees are well organized in the Amalgamated Association of Street and Electric Railway Employees of America and for some years prior to the war had, in many localities, been dealing collectively through the union with the street railway companies in matters affecting wages, hours and conditions of employment. In the wage arbitra- tions in 1919 and 1920, their most important demands centered about wages and the cost of living, while in 1921 the companies asked for decreases in wages, based on decreases in the cost of living. These proposals for a lowering of rates were vigorously protested by the union. In many of these street railway wage arbitrations, figures were introduced purporting to show the cost of living as estimated on the budgetary plan. The union frequently retained the for- mer secretary of the National War Labor Board as their econo- mic adviser, and every effort was made to force a consideration of the minimum wage in relation to the estimated cost of living for a family of five persons, rather than of a wage which should attempt merely to keep pace with the rising cost of living. This was done for the purpose of establishing a new and higher standard of living than that which prevailed before the war. It was claimed that the resolution passed by the National War Labor Board on July 31, 1918,2 had prevented organized labor from pushing their claims and securing the utmost in their wage bargains during the war, but that, with the war over, labor intended to secure wages which would procure for them not only health and decency in the standard of living, but some degree of comfort as well. ^ With this end in view, the union based its claims for increased wages on the minimum comfort budgets summarized in Chapter III of the present report, particularly that of the United States ^ Harvard Law Review, November, 1919. pp. 47-48. 2See p. 77 of the present report. 'See, for example, Boston Elevated Railway Company Arbitration, May 3, 1920, Steno- graphic Transcript, vol. 4, p. 223 ff. 78 Bureau of Labor Statistics for a government employee in Wash- ington, D. C. It was not claimed that these were the actual ex- penses of street railway employees. Rather these budgets epitomized what it was considered that street railway employees ought to have to meet a standard of health and decency con- ceived by physiologists, social workers, economists and statis- ticians as essential to the maintenance of a fair standard of living. There was, apparently, no attempt to show that street rail- way employees' families actually averaged five persons of the age and sex composition set out in the standard budgets. It was admitted that housing of the character specified frequently could not be obtained in the communities under consideration, and no one seems to have denied that the clothing needs of a street railway motorman or conductor were in some respects different from those of a government clerk in Washington. Nor was there any assurance that, given the income demanded as necessary for the maintenance of a standard of health and decency, families would spend their incomes in the way out- lined in the theoretical budgets. Criticisms of the American minimum budgets summarized in Chapters II and III of the present report were also frequent.i It seems not to have been understood that these were minima by which all others were to be measured, or that, because they were based on conditions actually prevailing, they were more representative of the manner in which wage-earners in a given community would have to spend their money than were theo- retical budgets constructed for a theoretical community. It was frequently urged that the employment of women and children and the taking of boarders and lodgers were the result of the insufficient wages earned by the men. The very nature of the family which was chosen as typical, however, precluded the possibility of the children working, since all were supposed to be under 14 years of age. As shown in Chapters IV and V of the present report, this family of five, where the father is the only wage-earner, is representative of a very small proportion of all wage-earners' families, inasmuch as at any given time the average number of children under 14 years of age will certainly be less than three, and the person completing the family averag- ing five persons is more likely to be an additional wage-earner than not. In some of the street railway wage arbitrations, prices were collected in the localities in which the wage rates were to be fixed. In most of them, however, generalized estimates of the cost of living were presented, or estimates made in another locality were given as if they applied in the one under considera- tion. In the Boston Elevated Railway Arbitration, a minimum budget was presented from Lawrence, Mass., and a "health and *See, for example, ibid., p. 231 S. 79 decency" budget from Washington, D. C. The question was asked of the witness presenting these budgets if he was "familiar enough with the facts to know whether the actual costs of the necessaries of life are greater in Washington than in Lawrence, for instance: "The Witness: I think that probably they would be the same, not .any appreciable amount of difference, but I think the habits of the people would be entirely different in the way of buying clothing but probably not of food. I do not know. "Chairman Boherty: You think that food would be just as cheap in Washington as in Lawrence? "The Witness: I think so, yes sir; and, as a general proposition, it is about the same everywhere. There are some slight variations."' In 1921, these same budgets were used to oppose the wage decreases frequently demanded by the companies, and attempts were made to show that, even at prevailing wages, it was not possible to maintain a fair standard of living. 2 The Bituminous Miners' Case, 1920 The United Mine Workers of America, at their biennial con- vention in September, 1919, decided to demand a 60% increase in wages, a six-hour day, a five-day week and certain other con- ditions of employment, and threatened a general strike in the industry on November 1, 1919, if these demands were not then acceded to. Conference between the miners and the operators failed to bring agreement. The United States Fuel Administra- tor's suggestion that a 14% increase, to be absorbed by the industry, would be fair, and the efforts of the Secretary of Labor proved fruitless. When a strike seemed inevitable, the President of the United States offered to appoint a com- mission to arbitrate the case, but the miners refused all proposals for such a settlement of the dispute. A strike was finally declared in November, 1919, and a restraining order, followed by a writ of temporary injunction from a United States court, compelled the miners to have their wage controversy settled in an orderly fashion. The merits of their demands were arbitrated by a commis- sion of three, appointed December 19, 1919, by the President, composed of one representative of the mine owners, one of the miners' union and one of the public. The commission or- ganized immediately and began taking testimony on January 'Boston Elevated Railway Company Arbitration, op. cit., pp. 259-260. 'In addition to "Standards of Living," op. cit., introduced at many of the wage arbitra- tions in 1920 and in 1921, the following report of the Bureau of Applied Economics, Inc., prepared for presentation before the United States Railroad Labor Board in 1921, were intro- duced at the street railway wage hearings: "What a Living Wage Should Be," Chicago, 192 1; "The Living Wage," Chicago, r92i; "Seasonal Fluctuations in Prices and Cost of Living," Chicago, 1921. These reports were used, for example, at the arbitration between the New York Railways Company andits employees, and at that between the Connecticut Company and its employees, as well as in a number of other arbitrations of street railway wage cases ini92i. 12, 1920. A large part of the hearings was taken up with questions affecting the living wage. The point made in the street railway cases was emphasized here, viz. : that "the primary demand of the mine workers . . . was not for a restoration of pre-war conditions. Their primary demand was for a living wage . . . ."1 In order to determine what this living wage should be, the miners engaged William F. Ogburn who, it will be remembered, had made the original budget showing a level of comfort in Seattle in 1917 and who later had charge of the cost of living investigations of the National War Labor Board, "to make a special study and report on the subject of the living wage as related to bituminous mine workers' families. "2 The report prepared by Ogburn for the miners was not based on a canvass of the standard and cost of living of bituminous miners' families, but, as pointed out on pages 46-48 of the present report, was made on the basis of prices secured in certain bitu- minous mining towns for the goods and services listed in the budget prepared the year before by the United States Bureau of Labor Statistics for the family of a government clerk in Washington, D. C. Certain changes were made in the man's clothing budget, an allowance was made for explosives, smithing, etc., and deductions were made from the cost of food to take account of possible saving by the keeping of chickens, a garden, etc. Otherwise, the budget Ogburn worked out was made up on the theory "that what is a standard of health and decency for families of Government employees should in its main outlines also be the standard of health and decency for families of mine workers." 2 The total cost of this budget at prices prevailing in January, 1920, was $2,243.94 a year, a sum which it was said the 27% increase in wages awarded by the Commission would by no means cover in the case of a large proportion of workers.* Cases Before the United States Railroad Labor Board, 1920, 1921 The United States Railroad Labor Board was organized in April, 1920, under the Esch- Cummins law, to act as a tribunal for the settlement of such disputes as arise between the rail- roads of the country and their employees. One of the first cases coming before the Board was the demand by the railway brotherhoods and shopcraft unions early in 1920 for an increase in wages. The unions engaged the former secretary of the National War Labor Board to handle their case before the Railroad 'United States. Bituminous Coal Commission. Majority and Minority Reports to the President, Washington, 1920, p. 74. 'Ibid., p. 78. •"Standards of Living," op. cit., p. 48. 'Report of the Bituminous Coal Commission, op. cit., p. 80. 81 Labor Board, and the use of family budgets in building up the argument for increased wages was similar to that which was already familiar in the street railway and bituminous coal miners' cases, viz., that not only had wages of the railroad em- ployees of the country not kept pace with the rising cost of living, but that, even if they had, this was no guarantee that sufficient wages were being paid. Justification of this position was found in the assertion that the level of pre-war wages was too low to permit the maintenance of a proper standard of liv- ing. Therefore, to add merely enough increase to keep the pre-war standard would allow nothing for an improvement. The unions insisted on opportunity for such improvement and, therefore, presented estimates of what they believed a living wage should be.i The Transportation Act, under authority of which the Rail- road Labor Board was created, specified seven considerations which should enter into the determination of wage rates, as follows : "1. The scales of wages paid for similar kinds of work in other industries; "2. The relation between wages and the cost of living; "3. The hazards of the employment; "4. The training and skill required; "5. The degree of responsibility; "6. The character and regularity of the employment and "7. The inequalities of increase in wages or of treat- ment, the result of previous wage orders or adjustments." The increase in wages allowed by the Railroad Labor Board in 1920, which averaged 22%, was based largely on the increase in the cost of living since the war and not on prevailing costs at the time the award was made. The intention was to make up the difference between current wages and the prevailing pre-war standard, by adding such an amount as would meet the rise in the cost of Hving.2 In 1921, the railroads re-opened the question of employees' wages by demanding a decrease, based on the decrease in the cost of living and on the decrease in wages paid in other in- dustries. ^ At the hearings before the Railroad Labor Board, the principal argument of the unions against the reduction de- manded was that, although the cost of living might have been somewhat reduced since increases had been granted the year before, this decrease was largely seasonal. Moreover, it was claimed that adjusting wages to meet changes in the cost of ^Bureau of Applied Economics, Inc., "Changes in Cost of Living and Prices, 1914 to 1920." Bulletin Number 6, Washington, 1920; ibid., "Studies of the Cost of Maintaining a Family at a Level of Health and Reasonable Comfort," Washington, 1920; ibid., "The Cost of Maintaining a Family at Prices Prevailing in December, 1919. A summary of the Most Important Authoritative Studies of Family Living and Standards of Living," Washing- ton, 1920. ''Monthly Labor Review, September, 1920, p. 102; The Survey, August 2, 1920, pp. 586-587. 'Railway Age, April 22, 1921, pp. 988-991. 82 living was a wartime expedient, and that the actual cost of main- taining a suitable standard of living was even then greater than the wages received by a large proportion of railroad employees. For these reasons it was claimed by the unions that no reduction in wages should be made.' The budgets introduced in support of the argument regarding the amount of a living wage in 1921 were those presented at the hearings before the Board in 1920 and at the hearings before the Anthracite Coal Commission in July of the same year. The cost of these budgets in April, 1921, was determined by adding to the cost at the time they were collected such percentages of increase as would bring them all to this common date. So- called "subsistence budgets," and so-called "minimum comfort" budgets were introduced. ^ The award of the Railroad Labor Board in June, 1921, an- nounced an average reduction in wages of 12%. This was based not only on decreases in the cost of living but also on decreases in the rates of wages paid in other industries and on the existing unemployment.* The Anthracite Miners' Case, 1920 The demand of the anthracite mine workers for an increase in wages came before a presidential commission in much the same way as that of the bituminous miners. Voluntary agreements between the mine operators and the men, which, with renewals and changes, had been in force since 1903, ran out April 1, 1920. For a month prior to that date representatives of the mine workers and of the employers had been endeavoring to reach an agreement. The 60% increase in wages demanded by the miners — later reduced to 27%, the increase just awarded the bituminous miners — proved too great a stumbling block to mutually acceptable terms, and the voluntary negotiations were broken off with the miners' rejection of the operators' offer of 15% increase. The Secretary of Labor, to whom the case had gone, suggested 17% increase as fair, and to this the operators agreed. The miners, however, refused assent. Finally, in the summer of 1920, the President appointed a commission of three to arbitrate this case as earlier in the year a commission of three had arbitrated the demands of the bituminous miners. A large number of exhibits were introduced by both the miners and the operators. Those submitted by the unions were very similar to those presented to the Railroad Labor Board a few weeks previously. They included a repudiation of the theory that wages should merely keep pace with the cost of living, and an attempt was made to establish a minimum wage on the basis ^Ibid., May 6, 192X, pp. 107S-1076; Before the United States Railroad Labor Board, "The Living Wage," Presented on Behalf of the Railway Employees, Chicago, ig2i;ibid., •'Seasonal Fluctuations in Prices and Cost of Living," Chicago, 1921. '"What a Living Wage Should Be," op. cit. 'Railway Age, June 3, 1921, pp. 1259-1262. 83 of the cost of maintaining a standard of comfort for a family of five at the time of the arbitration in 1920. The estimates of the cost of living presented by the miners were more detailed than any of those previously offered and were definitely divided into two groups. The first, which was said to representa "subsistence level of mere existence only," was based on first-hand studies of the cost of living among rep- resentative famihes in a number of localities. Six of the ten budgets were for families in New York City. These studies are summarized in Chapter II and the first part of Chapter III of the present report. The standard of living these budgets represented was, how- ever, said to be entirely unsatisfactory. As more nearly meet- ing suitable requirements, six other budgets were introduced.* These were all theoretical and were designed to indicate what the cost would be for a family of five persons to maintain a minimum standard of comfort. It was for the maintenance of this standard that the miners contended. The exhibits presented by the operators at this wage arbitra- tion were probably the most complete statement of the em- ployers' position regarding a living wage that has ever been introduced in American wage arbitrations. 2 In this, the mine operators contended that they had been paying and expected to continue to pay a living wage. Evidence for this was to be found in the generally prevailing prosperity throughout the anthracite region as shown by savings banks deposits, the amounts spent on recreation, and the prosperous condition of all business which catered to the wants of wage-earners in the area. The award, as finally made by the commission on August 1, 1920, allowed the anthracite miners 17% increase in wages, based definitely on the rise in the cost of living. » Arbitrations of wages in other industries, held for the most part before voluntarily organized tribunals, also frequently con- sidered family budgets, but the use of the latter in these has been so similar to the important cases already cited as to re- quire no further description here. Conclusion In the present chapter has been presented a very brief account *For budgets, see pp. 29-31; 41-48 of the present report. The following exhibits were introduced "Changes in the Cost of Living and Prices, 1914 to 1920," op. cU., "Standards of Living," op, cit.; Before the United States Anthracite Coal Commission. "What a Living Wage Should Be," Presented by W. Jett Lauck on behalf of the United Mine Workers of America, _ Washington, 1920; ibid., "The Sanction for a Living Wage"; ibid.t "The Practicability of a Living Wage"; ibid., "Income and Expenditures ot Anthracite Mine Workers' Families in Scranton, Pennsylvania, 1920." 'Before the United States Anthracite Coal Commission. Exhibits of the Anthracite Operators in Reply to Exhibits Presentedjby the Anthracite*Mine Workers, Scranton, Pa., July, 1920. 'United States. Anthracite Coal Commission. Report, Findings and Award, Wash- ington, 1920, pp. 40-41. 84 of the use made of family budgets in the arguments and awards in wage disputes in the United States in recent years. In most, if not all, of these cases other issues such as hours and collective bargaining have been involved. These have not been discussed in the present report, however, since they were con- cerned with the question of wages in relation to the amount to be paid rather than in relation to the principle of determination. The evidence suggests the following conclusions: 1. Prior to 1915 family budgets were not used as the basis for adjusting wages of adult male workers in the United States, save in perhaps a few isolated instances. When the cost of living began rising during the early years of the war, and it became necessary to adjust wages so as to take account of this fact, little data were available on which to predicate suitable wage advances. For many years, however, there had been advocates of the establishment of the minimum wage in this country by a method similar to that in use in Australia since 1907.1 Xhe necessity of adjusting wages in this country to take account of changes in the cost of living during the first years of the war gave an opportunity for trying out these theories. At first, apparently, these advocates of the minimum wage, although they accepted the Australian family of five as a meas- ure of costs, clung to the American budgets already collected as a measure of standards. It was not until the Pacific Coast street railway arbitrations in 1917 that the so-called "standard of comfort" was introduced as the measure of a minimum wage. From then on, however, this standard was most frequently urged in wage disputes, and the earlier standard was repudiated as providing merely for "animal existence." 2. Few awards were made, however, on the basis of esti- mates of the cost of maintaining the so-called "minimum of comfort" budget. During the war, the National War Labor Board sometimes set minimum rates on the basis of estimates of the cost of living determined from the so-called "subsistence" budget, but usually even this was disregarded and the prin- cipal consideration taken into account was the rise in the cost of living. After the war, practically all important wage ar- bitrations were decided with this end in mind, viz., that wages should keep pace with changes in the cost of living, whether up or down. While it is evident that the figures showing costs in the more liberal budget were designedly set high, for bargaining purposes, by those who used them, it seems clear that estimates made on this standard, so much higher than was commonly known to be 'The Australian theory of the basic wage is derived from Justice Higgins' decision in 1007 that the lowest wage to be paid an unskilled laborer was such an amount as was nec- essary to meet the "normal needs of the average employee, regarded as a human bemg living in a civilized community." This standard, as established for adult males has meant a wage sufScient to support a man, woman, and three small children. 85 the prevailing cost of living, alienated arbitrators whose famili- arity with the facts made them skeptical of the entire budget. 3. The artificiality of the minimum comfort budgets was most apparent to employers. The family of five persons fre- quently was not representative of their workmen; the standard of living pictured was not characteristic of their industry or their employees or their locality. The attempt to use budgets, developed in one place for one purpose, as a measure of the standard and cost in another appealed to them as particularly unjustified. 4. Family budgets, as a measure of the sufficiency of wages paid, were not repudiated by employers because they refused to pay a living wage. On the contrary, every wage artibration of any importance brought out the assertion by the employers that they believed in a living wage and intended to pay at least a living wage. They denied, however, that this could be meas- ured by theoretical budgets tor theoretical families and insisted that the only fair measure of the sufficiency of wages was the prevailing standard of living in their own community among their own operatives. 86 APPENDICES Appendix Table A Average Cost of Living Among White Families in 35 Shipbuilding Centers in the United States in 1917-1918 (United States Bureau of Labor Statistics) Locality^ Period of time covered Num- ber of fam- ilies Average yearly cost of living Percentage of cost of living spent for — Food Cloth ing Shel- ter Fuel and light Sun- dries Norfolk. Va. Year ending March 31, 1918 97 $1,670.99 42.36 15.05 10.62 5.14 26.83 Detroit, Mich. Same 2S6 1,596.40 40.73 14.36 14.59 5.47 24.85 Seattle, Wash. Same 208 1,569.10 36.75 15.34 13.48 4.66 29.79 Newport News, Va. Same 72 1,547.73 39.65 16.09 10.91 4.68 28.67 Tacoma, Wash. Same 103 1,536.02 35.97 15.87 7.69 4.43 36.04 Boston,. Mass. Same * 210 1,519.90 42.45 14.75 12.92 5.25 24.63 Chicago, HI. Same 215 1,467.99 41.96 14.35 12.78 5.33 25.58 Bath, Me. Same 99 1,451.18 45.28 16.35 9.86 6.76 21.75 Baltimore, Md Same 205 1,450.52 43.07 15.87 10.46 4.20 26.40 Cleveland, O. Same 203 1,450.40 41.97 14.99 14.17 3.90 24.97 San Francisco, Cal. Same 286 1,441.29 40.10 15.10 15.99 3.81 25.00 Lorain, 0. Same 109 1,433.12 41.90 15.48 14.78 4.07 23.77 Toledo, O. Same 207 1,415.66 42.75 13. 8C 13.58 4.92 24.95 Portsmouth, N. H. Same 104 1,406.97 44.05 15.25 10.50 6.13 24.07 Philadelphia, Pa. Year 1917 512 1,398.83 43.31 15.97 12.04 4.95 23.74 Manitowoc, Wis. Year ending March 31, 1918 111 1,372.45 40.03 14.80 19.05 5.74 20.38 New York, N. Y. Year 1917 608 1,348.64 45.01 14.84 12.91 4.61 22.63 Superior, Wis. Year ending March 31, 1918 109 1,345.06 40.79 16.06 11.78 6.25 25.12 Portland, Ore. Same 164 1,338.41 38.75 14.99 13.09 4.39 28.78 Buffalo, N. Y. Same 204 1,338.37 44.65 14.14 13.51 4.09 23.61 Portland, Me. Same 103 1,334.55 44.70 15.51 11.49 6.15 22.15 Los Angeles, Cal. Same 157 1,288.79 39.99 14.57 14.84 3.10 27.50 Savannah, Ga. Year 1917 40 1,287.73 43.78 15.10 10.51 5.10 25.51 Beaumont, Tex. Same SO 1,284.27 44.72 11.08 17.37 3.86 22.97 Jacksonville, Fla. Same 54 1,271.90 41.91 13.07 12.93 4.90 27.19 Houston, Tex. Same 91 1,255.88 46.28 13.68 12.22 3.52 24.30 Orange, Tex. Same 45 1,188.47 49.97 13.07 11.86 2.95 22.15 Pensacola, Fla. Same 65 1,177.21 47.19 12.57 11.53 4.65 24.06 Brunswick, Ga. Same 35 1,152.83 42.89 14.40 10.23 5.64 26.84 Mobile, Ala. Same 100 1,127.31 46.87 12.38 11.38 4.74 24.63 Tampa, Fla. Same 51 1,116.62 44.67 12.24 12.14 4.22 26.72 Pascagoula, Miss. Same 32 1,088.62 54.39 13.98 8.31 3.67 19.65 SlideU, La. Same 50 1,038.89 51.84 13.73 8.69 3.83 21.91 Madisonville, La. Same 27 1,013.44 53.19 13.11 11.20 2.74 19.76 Moss Point, Miss. Same ?6 914. 2S 53.65 13.41 6.87 3.44 22.63 89 M w m < a Q H H K !3 <: o o H < M CO CM "S «^ s O 00 "5 S ^ a " r», f a w s ri ^ ^ w e o < o o o O M O < OS i •s 1 o 00 00 oo' d /5 o -* 1 W) IT) 00 to to 00 to' M M IS o N O o 00 00 *# O es o 00 1 O t^ s o to lO *o S5 to lO to to 00 to 00 fO 1^3 s s § 00 i o o s CN oo' IN 00 00 ts 00 10 Average yearly cost of living ON 00 ro fO o o 0\ 1 00 Ov lO o >o to s lis teS8 00 >o o 00 es a 00 00 to 00 CM 1 «' 1 Ov 1 i < hll CO o to CO fO 3 00 to to to to to to 10 fO to' 1 1 o O ■* >o >o IT) to •/I to 10" «o 1 i 2 -* 00 t>. 8 o o s ■* t- 3 10 111 .2 81 •d ■o OOoi 22 -a a d rO(s> 1 si So. 2S i •d 22 ©DO s 2S CO (±4 1 22 «2 S2 1 00 00 •a § Mo, 22 Ii S 22 COS. > 8 1 ■s "3 FQ d 1 1 o 1 3 1 1 o 1 d CO S 1 •3 Q § e S S 6 90 a H w e o < < o H < < W 0] CjOO la < ^ '-' WON ^ ,-1 O P-H " M M S H (O w t!-i .-a Q 0. 0. 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Cornell University Library HD 6983.N35 3 1924 002 665 036 DATE DUE r" yt-H,""*' T HIWP'^ j^ J «^_ rrn i; - rcD J 133U CAYLOHD PniNTEO IN U.S.A.