The British Iron and Steel Industry: 1929-49

Abstract

r-_,H:E British iron and steel industry did not share equally in the general . economic revival following the close of the first World War. Urgent demands upon productive facilities during the conflict caused a hasty and often haphazard expansion of existing works. Accordingly, when war orders ceased and the short-lived activity came to an end, the industry found itself with much redundant plant. Many firms could not earn enough to cover the heavy capital charges incurred in construction. Largely as a result of the occupation of the Ruhr, total profits of the industry rose above the level of I9I3 during the years I920, I923, and I924. Thereafter, earnings fell considerably below prewar figures. To add to the difficulties, the expansion -of the past decade led to an increase of bond issues, resulting in heavy inroads upon reserves and a diminution of funds available for distribution to common stockholders.' Attempting to offset declining revenues, a number of large manufacturers undertook the establish-ment of vertically integrated combinations.2 Moreover, a National Federation of Iron and Steel Manufacturers was formed in I9I8. Originally organized at the suggestion of the government, the Federation published statistics relating to the industry and studied questions of transport and fuel. It did not deal with prices and wages.3 The period revealed an alteration in the ratio of costs of materials and labor to total productive outlay. Whereas wages in I9I3 had represented II.7 per cent of the cost of producing one ton of steel ingots, the same item in I924 accounted for I6.5 per cent of the total. Expenditures for materials declined from 73.5 to 71.5 per cent. The increasing importance of wages as a cost-determining factor was even more apparent in comparable figures relating to highly finished products.4 Until I9I3 there were a number of separate unions representing iron and steel workers. By I928, however, almost half the total employed were members of the Iron and Steel Trades Confederation. A significant change in industrial policy was indicated by the adoption, in I9g9, of the eight-hour shift. Wages were generally fixed, through collective-bargaining agreements, on a sliding scale based upon the selling priceof products in various sections of the industry.5 British imports of iron and steel increased markedly during the postwar decade. This rise was principally in semifinished materials used largely in the manufacture of sheets and tin plates and