American Academy of Political and Social Science

Industrial Waste
Author(s): L. W. Wallace
Source: The Annals of the American Academy of Political and Social Science, Vol. 97, The
Revival of American Business (Sep., 1921), pp. 36-42
Published by: Sage Publications, Inc. in association with the American Academy of
Political and Social Science
Stable URL: https://www.jstor.org/stable/1015322
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36 THE ANNALS OF THE AMERICAN ACADEMY

that
thatwhich
whichnow
now
prevails.
prevails.
We will
Wenot
will not It
It is
is always
alwaysdifficult
difficult
to to
forecast
forecast
for for
return
returnforfor
a long
a long
timetime
to thetolow
the
interest any
any considerable
low interest considerable period
periodin the
in the
future
future
rates
ratesofoftwenty
twentyyears
years
ago, but
ago,itbut it seemsthe
seems the resultant
resultantofofsuch
such
complex
complexforces
forces
as as
entirely
entirelylikely
likely
thatthat
we will
we work
will well
work wellthose
thosewhich
whichunderlie
underliethethe
raterate
of interest.
of interest.
down to the level of 1913. Liberty But the fundamental factors which
bonds, unless some unforeseen event operate upon the demand for capital
arises, should be at par within three and those which determine its supply
years, and all high-grade investment after a period of business depression
securities of long maturities should rise are such as will inevitably reduce the
accordingly. rate of interest.

Industrial 'Waste
By L. W. WALLACE, M.E.
Executive Secretary of the Federated American Engineering Societies

IN January,
January, 19l1,
19l1, Herbert
HerbertHoover,
Hoover,asas
the committee,
committee, care
care was
was taken
takentotosecure
secure
president
president of
of the
the Federated
FederatedAmeri-
Ameri-men ofof broad
broad experience,
experience,clear
clearconcepts,
concepts,
-can Engineering
Engineering Societies,
Societies,named seven-and unbiased attitude towards indus-
namedseven-
teen engineers
engineers to
to make
makeaastudy
studyof wastetrial problems. Representatives of
ofwaste
in industry.
industry. The
The federation
federationof engin-managerial, consultant, educational
ofengin-
eering
eering societies
societies was
was new;
new;Mr. Hooverand editorial activities were chosen,
Mr.Hoover
was its
its first
first president.
president.AtAtthe
theorgan-
organ-with an eye also to their widely dis-
izing
izing meeting
meeting held
held in Washingtoninintributed and varied industrial con-
inWashington
November,
November, 19o0,
19o0, Mr.
Mr.Hoover
Hooverproposed
proposedtacts.
the study
study and
and was
was authorized
authorizedtotomake
make When the "assay" began, the com-
the investigation.
investigation. mittee itself selected with great care the
There
There was
was peculiar
peculiar fitness
fitnessin
inthe sub-engineers who conducted the field in-
thesub-
ject thus
thus undertaken
undertakenby bythe
theFederated
Federatedvestigations. The engineering firm em-
American
American Engineering
EngineeringSocieties,
Societies,inas-
inas-
ployed to investigate a given industry
much
much as as the
the object
object of
ofthe
theorganization
organization was chosen because it had a long and a
is to further
further public
public welfare
welfarewhenever
whenever favorable record in that particular type
technical
technical knowledge
knowledge and andengineering
engineeringof industry. Thus was brought to bear
experience
experience are
are involved,
involved,and
andto consider upon the plans, findings and recom-
toconsider
and act
act upon
upon matters
mattersof ofcommon
commoncon- con-
mendations, the accumulated and com-
cern to the engineering and allied posite knowledge and experience of some
technical professions. The "assay of fifty or more engineers. In many phases
waste" undertaken by the Committeeof the work other specialists, such as
on Elimination of Waste in Industry economists, statisticians, employment
was, as Mr. Hoover outlined it, to be managers and industrial physicians
a three months' investigation of a had an important part in collecting the
series of "samples" from which might material and in drawing up the conclu-
be deduced general recommendations sions. An earnest effort was made to
applicable to American industry as a obtain the advice and the accumulated
whole. information of every known agency
The personnel of the committee con- or individual that could throw any
sisted of eighteen carefully selected en- light upon the subject in the time
gineers. In selecting the members of allowed.

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 INDUSTRIAL WASTE 37

The essence of the plan adopted by

RESPONSIBILITY AND OPPORTUNITY
the committee was to gather quickly
THE POINT OF VIEW
such concrete information as might be
used to stimulate action and to lay In making the studies upon which the
the foundation for other studies. It report was based and in preparing the
was believed that a limited, yet care-
report itself, there was no purpose or
fully studied volume of findings desire
ob- to place blame upon any individ-
ual, group or class. It is believed that
tained through a rapid intensive study,
the wastes revealed are the inevitable
would not impair the value of the facts
disclosed or the validity of the recom- result of methods, practices and rela-
mendations based upon them. So tionships of long standing in industry,
within less than five months the com- and the committee has relatively little
mittee completed an "assay" or analy-interest in pointing out the various
sis of waste in six typical branches of responsibilities for these. In contrast,
industry, and presented a summary ofit desires to indicate the main oppor-
its findings to the Executive Board of tunities for eliminating waste and whose
the American Engineering Council, opportunity or responsibility it may be
which is the governing body of theto adopt proper measures for such
Federated American Engineering Socie-elimination.
ties. This took place on June 3, 1991, No attempt has been made to write
in St. Louis, at which time a condensedan academic definition of waste or to
news abstract was given to the press. speculate in regard to ultimate savings.
The complete report is now being For the purpose of the report, no at-
printed in book form. tempt has been made to consider
The original plan contemplated ten all economic wastes. Rather, in the
investigations in the field, including committee's investigations, industrial
transportation and coal mining. Sixwaste has been thought of as that part
have been completed. These include of the material, time and human effort
the building trades, men's ready-madeexpended in production represented by
clothing, boots and shoes, printing,the difference between average attain-
metal trades and textile manufacturing. ments on the one hand and the practical
In addition to these specific field stud-attainable performance on the other, as
ies, seven general reports of a statisti- revealed by the detailed reports. In
cal character were prepared, each ofassaying waste in industry the com-
them dealing with some aspect of in- mittee has undertaken to evaluate this
dustrial waste or its elimination on an difference. Thus it has established no
extensive or nation-wide basis. theoretical standard of performance or
The industries selected for specific excellence, but has developed a method
study are of great public importance, of measurement to determine the de-
for their operation directly affects the gree of effective use of those factors
daily life of everyone. It is believedwithin which it was believed waste
that the sources of waste in these in- might be discovered. It has conceived
distries may safely be taken as general- that a given practice is not wasteful
ly characteristic of the waste in Ameri-until a better has been revealed.
can industries as a whole. It is thought
that the findings are not exceptional, PLAN OF STUDY-QUESTIONNAIRE
AND EVALUATION SHEET
and certainly the industries selected
were chosen in the belief that they are The plan of study followed in each
fairly representative. of these six branches of industry in-

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38 THE ANNALS OF THE AMERICAN ACADEMY

vestigated was this: at the outset the confused by a lack of common knowl-
members of the committee prepared an edge of the meaning of industrial and
analysis of those factors and operations management terms. Take "Collective
in industry in which waste might be ex-Bargaining" and "Closed and Open
pected to be discovered, provided a Shop" for examples. We venture to
comparison was made between averagesay that if the people were to be asked
practice and the best known practice.for a definition or an interpretation,
From this analysis, a trial question-nothing approximating uniformity
naire was prepared to secure informa-would be obtained in reply. There is
tion and quantitative data to permit ofa great need for constructive work in
comparing the record of one plant with defining such terms. The establish-
another in the same industry. The ment of a common terminology and a
questionnaire is composed of 58 main concrete definition of industrial words
topics and 260 leading questions. and phrases would lead to the elimi-
This indicates the multiplicity of ave- nation of much misunderstanding
nues through which waste may occur. throughout industry.
This trial questionnaire was then Second: Another very significant
used in making a study of one plant inneed is the creation of standard units
each industry. The results of these of measurements for the various fac-
tors of management. This applies par-
trial studies were then brought together,
compared, reviewed by the committee ticularlyto the factors of individual and
group performance. It is true that
and, as a result, a revised questionnaire
and an evaluation sheet were prepared,there are some factors of management
to be used in making the studies upon for which it would be exceedingly diffi-
which the report is based. The revisedcult if not almost impossible to create
questionnaire, as used with suggested and to apply units of measurement, yet
modifications based on the experience there are many for which it can be done.
accumulated in its use in the field It is also true that some progress has
studies, forms an important part of been
themade in the way of establishing
report. standards for gauging individual and
group performance. But in the main
CALENDAR OF THE STUDY
the practice is limited and based upon
The committee was named on Janu- inadequate data and faulty premises.
ary 12; its working program was It has not been approached in as thor-
approved on February 7; the first de- ough and scientific a manner as its
tailed report was in on April 1, and the importance would justify. In a very
last on May 13. large degree the whole system of wage
payment is faulty because it is not
OUTSTANDING FEATURES OF THE
based upon facts scientifically arrived
REPORT
at; and further, in a great degree defi-
Some of the outstanding features nite standards of performance are not
developed are: known.
First: There is apparent a lack of Third: In the realm of industry
a common terminology of management there is no agency that can furnish
and personnel factors. This lack is complete, timely and authoritative in-
the cause of much confusion. To one formation concerning any one or all of
group the word management means the
oneimportant factors of production.
Until basic, timely and authoritative
thing; to another an entirely different
meaning is conveyed. The public is known, no rational remedy can
data are

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 INDUSTRIAL WASTE 39

be evolved for solving any industrial, tion. This being the case, there is a
economic, social or political problem. need for a permanent clearing house
On so vital a thing as unemployment for unemployment and intermittent
there is no central bureau of infor- employment. It should be the func-
mation; the facts have to be pieced tion of such a bureau to make an ex-
together, so to speak. Last January haustive analysis of the many factors
and February some three to four mil- connected with unemployment so that
lion workers were out of employment, such information and accumulated ex-
but no one knows just how many and perience may at all times be available.
no one knows what classes of trades were Further, it should study the causes,
represented and in what proportion. analyze the remedies applied, make
The causes contributing to such con- recommendations as to how to alleviate
ditions and the remelies to apply are in emergencies, and, finally, suggest
still undefined. As such conditions what might be done to bring about a
arise from time to time, unemploy- more permanent or stable employment
ment committees, boards and conm- cycle. The advantages to accrue are
missions are appointed which study the large in social, political, industrial and
problem, collect data, make recomimen-economic values. For after all, much
dations, apply some temporary rneas-of the unrest, suspicion and disturb-
ures of relief, and disappear. The ance among workers results from the
emergency passes. The information sub-conscious and conscious fear of un-
collected, the experience gained and employment. This is made apparent
the effectiveness of measures used are
by the fact that the so-called seasonal
not adequately recoided; consequently,
industries, as clothing and building,
when a similar emergency re-occurhave it had the greatest amount of labor
is again approached as a new and an un-
disturbance. In 1919, 32 per cent of
all strikes in New York were in the
solved problem. Information is needed
not only to meet emergencies but to clothing and building industries.
meet what appears to be a "normal" In the matter of strikes and lockouts
unemployment of a million of those there is no central source of authorita-
classed as gainfully employed. What
tive information. It is the belief of
are the economic, industrial, political,many that there should be central bu-
social or mental conditions which cause reaus of information concerning many
one out of every forty of those that arephases of industry, as the quantity of
supposed to be gainfully employed to beraw and finished materials, the cost of
constantly out of employment? No basic raw materials and the like. Un-
one knows; no one can definitely til such bureaus are established, in-
state what really is the situation and dustry as a whole will continue to be
what to do if the apparent facts are as wasteful, because without a knowl-
represented. edge of the facts, rational measures of
Again, there is a large seasonal un- correction cannot be evolved.
employment or intermittent employ- Fourth: There is a real need for some
ment, which adds many hundreds of form of cooperation that will safeguard
thousands to the normal or constant the interests of the public, yet permit
unemployment. The clothing work- of a free exchange of information be-
er is idle approximately 31 per cent
tween the various organizations of a
of the year; the shoe-maker, 30 pergiven industry and between interdepen-
cent; the building trade worker, 37dent industries. Many plants of a
per cent and others in like propor- given industry have developed and per-

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40 THE ANNALS OF THE AMERICAN ACADEMY

fected important and economical man- witnessed many protracted strikes in-
agement policies and practises whichvolving large numbers of employees.
are not known to the industry in gen-In 1912, with 47 per cent of the entire
eral. If they were known in detail bylabor force out on strike, and with an
the industry as such, better conditions
average loss per man of forty days, the
would prevail. It is also true that output of coal per man, per day and per
year, was more than 1911. There was
there is a great deal of duplication in
the expenditure of money for research also six days more employment than
in 1911, a year which was relatively
and other purposes, because of the lack
of an interchange of information. Of strikeless. The total production was
also more.
course, it is recognized that a certain
amount of such duplication is inevitable In addition to the direct losses
for purely commercial reasons, yet therethrough wages and curtailed produc
tion there are, of course, indirect losse
is here a large area of mutual interest.
but no means is available to determine
At the present time there is very
the extent of such losses. The infor-
little cooperation, co6rdination and ex-
change of information between interde-mation obtainable is inadequate on any
pendent industries. The manufacturer phase of the problem. There is no
of clothing uses the material producedagency that has the responsibility and
by the textile manufacturer. Like-authority to collect the information
requisite for a complete and authori-
wise, the users of paper take the prod-
tative analysis. There are complete
uct of the paper maker. Very nat-
urally there is a close community ofstatistics for the period from 1881 to
interest between the designer and the 1905. But since 1906 the Department
retailer of ready-made clothing. Yetof Labor has had no authority to "re-
these two important elements of the quire information relative to strikes
clothing industry have not until re-from anyone."
cently taken any steps towards cooper-Sixth: It is a fair statement that for
ation and coordination with reference the country as a whole there are no
to styles. adequate functioning bodies for the
Fifth: It appears, from the available
adjustment of industrial disputes, and
data, that the amount of waste fromhence the checking of industrial waste
that results therefrom. There are al-
the general run of strikes, through the
loss of wages and curtailment of pro- most as many varieties of legal machin-
duction, is less than commonly thought.
ery for adjusting labor disputes as there
This of course does not refer to the are states. Seven states have laws for
losses that occur through such strikes local arbitration, but no permanent
as are all inclusive, such as real or agency to execute them. Two states
threatened strikes on the railroads or in legalize permanent district or county
the steel industry. boards established by private parties.
That the apparent losses are less Nine states provide for arbitration or
than commonly thought is in part due conciliation by the State Commissioner
to the fact that the general run of of Labor or some other state officials.
strikes occur in seasonal industries. In twenty-seven states there are laws
Thus, the total production for a given creating a special State Board or Com-
season may be and is often realized mission
by for the settlement of labor dis-
prolonging the period of activity.putes. For In Kansas, a Court of Indus-
instance, more coal was mined in 1910 trial Relations has been established
than in 1911, although the former year with very broad powers. Nine states

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 INDUSTRIAL WASTE 41

make provision for local boards as well elevators under such a system is very
as for bodies with state-wide powers. large.
A recent examination shows that all A very prominent locomotive build-
this machinery for the adjustment of ing company was able to build 163
industrial disputes is active in eleven standard designed locomotives in five
states, that is, functions with more or weeks, while it was able to produce
less success; that it is inactive in five only 104 locomotives of industrial de-
states, and dormant in nineteen. That sign in the same period. Losses in
there is a real need for some adequateproduction due to lack of standardiza-
agency to function in the realm of la- tion arise in every industry. You
bor disputes is apparent. desire to build a home, an office or a
Seventh: A lack of rational standard- factory building. You ask for designs
ization of methods, practices, policies and bids; six, eight or ten contractors
and designs is a prominent cause for submit plans, specifications, and bills of
industrial waste. A great advance and material. The contract is let to the
refinement can be made towards stand- lowest bidder; but in his price is in-
ardization without in any way limit- cluded not only the cost to him of mak-
ing individual ingenuity or unnecessar- ing the plans and specifications for
ily curtailing the reasonable desires of your job, but also a percentage to cover
any person. The possibilities for stand- the cost of all other jobs on which he
ardization occur in almost every phase has placed a bid and has not secured the
of industry. order, or else a percentage to cover the
Some of the outstanding facts regard- cost of the other seven or eight bidders,
ing the losses resulting from a lack of there sometimes being an agreement
standardization are made apparent by among the bidders that this be done.
the following: The equivalent of In certain cities there are some bidders
8,000,000 passengers are transported who always bid high. They do not
daily by the elevators of the city of New want the contract. They make their
York. More passengers are thus hand- living by the commissions collected on
led than by all the street railway trans- their useless figures.
portation methods used in that city. The examples cited serve to indicate
Notwithstanding its great importance, that waste occurs because of change of
the architect, the engineer, the con- style or standards, no planning, inade-
tractor, do not design or build the quate standards, faulty and uneco-
structure around the transportation nomic designs.
medium, which is an important factor, Eighth: The 42,000,000 men and
but the transportation medium is placed women gainfully employed in the
wherever convenient; and it has often United States probably lose 350,000,-
happened that the building has been 000 days annually from illness disabil-
well under way before the elevator was ities, including non-industrial accidents.
even thought of. Consequently, some Tuberculosis is the most important
of the structure had to be removed in disease among industrial workers.
order to make a place for it. The net Pneumonia, influenza, typhoid fever,
result of all this lack of systematichook-worm and malaria are prominent
planning or standardization has been causes of industrial waste through the
that most elevators are built to fit the temporary or permanent loss of earn-
space that happens to be convenient. ing powers of millions of workers.
The economic loss through designing,There are more than 6,000,000 workers
constructing, installing and operating with organic diseases resulting mostly

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 THE ANNALS OF THE AMERICAN ACADEMY

from infection. More than 25,000,000 In every industry studied, outstanding

workers have defective vision requir- plants were found wherein much of
ing correction. the waste occurring in other plants had
These figures clearly indicate the been eliminated.
great economic waste that comes about No individual or agency wholly
through subnormal standards of health escapes responsibility for waste. The
and vigor. owner, the management, the workers,
Ninth: Industrial accidents contrib- the public have a definite responsibil-
ute a large amount annually to indus- ity and at the same time an opportu-
trial waste. In 1919 there occurred in nity. The degree of responsibility is
industry about 23,000 fatal accidents not fixed nor is there a definite ratio of
and about 575,000 non-fatal accidents responsibility for each group. This
causing four weeks or more of disabil- will vary with different industries.
ity; a total of 3,000,000 accidents It may not be the same for two plants
causing at least one day's disability. in the same industry. The evaluation
The figures for 1918 were about thir- of responsibility for remedying the con-
teen per cent higher. In the building dition as derived by the Committee
industry, enormous losses occur through places more than fifty per cent upon
accidents, the $20,000,000 paid yearly management and less than twenty-five
to insurance companies for compensa- per cent upon labor. That is to say, if
industrial waste is to be eliminated
tion being only a part of the total cost,
even if we disregard all human andmanagement can through its oppor-
spiritual values. The best authorities tunity remove more than fifty per cent
say that the actual cost of insurance of it, whereas labor can through its
represents not more than twenty-five opportunity remove less than twenty-
five per cent.
per cent of the total economic loss which
brings the total cost to the industry due If American industry is to flourish,
to accidents in the vicinity of $120,000,-
if it is to pass successfully through this
000. Experience has shown that by the trying period, if it is to withstand the
adoption of proper measures the waste foreign competition that is sure to come
due to accidents may be reduced from in the immediate future and at the same
seventy-five to eighty per cent in from time to pay such compensation to all
two to five years of earnest effort. connected with industry as not to lower
* * *
standards of living and to retard a
natural and desirable discussion
From the foregoing increase of those
upon a careful report
standards, it for
those responsible iswasteshow
the industrial waste
in industry in the
will have United
to adopt meth-
is enormous. That much of it can be ods and policies, which by practical
eliminated is obvious, which conclu- demonstrations have proven to be
sion is also supported by the evidence. efficacious.

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