J 
THE DEPRESSION. 
The depression in a number of industries and in what way 
Engineering is affected by them, and in turn affects them, has been 
pointed out. 
Other examples could be given, but these will be sufficient to 
show how general is the depression and how one industry’s 
depression affects the rest. 
Low sales and therefore low production mean high costs, and 
high costs in one industry mean high charges to those which use 
its products and they in turn must charge more. 
It has been shown how inextricably bound up with all industries 
is. the Engineering Industry, and how depression in any one or all 
of the other industries has a reaction on some section, at least, of 
the Engineering Industry. 
It is not suggested that the vicious circle so clearly demonstrated 
is avoidable. It is not; but attention has been directed to the 
intermingling of industry, from which it is clear that if any serious 
endeavour is to he made to rehabilitate our industries, piecemeal 
attempts will accomplish little or nothing for they will be nullified 
by the continuance of existing conditions in other directions. 
Production costs in all industries in this country appear, so far 
as can be ascertained, to be greater than elsewhere, and our industrial 
salvation appears to depend on a realisation of this fact and a 
universal recognition that only by a concerted effort by all concerned 
can we re-establish ourselves on a competitive basis. 
Not only is the relationship vertical, that is to say, up from 
the industries producing the raw materials or semi-manufactured 
materials which engineering finishes into the completed product, 
as in the case of Coal Iron and Steel, but it is horizontal, that is 
to say, as between Engineering and other finishing industries which 
in their processes use the finished product of Engineering, asin the 
case of the Textile industries. When the reactions in Coal and Iron 
and Steel and Engineering are examined, there is revealed the vicious 
circle, as the Coal and Iron and Steel pre-charges paid for by the 
engineer in his purchase price are again charged against the Coal 
and Iron and Steel manufacturers in their purchases from engineers. 
The Use of Imported Products. 
It may be convenient here to refer to the attempts to keep 
down costs by using foreign products. If coal is so dear as to make 
it difficult or impossible for the Engineering Industry to carry on,