It will be noted that in all the other industries referred to in
the table the same position applies. This is important in the light
of the cumulative wages load carried bv the Engineering Industry.
OTHER INDUSTRIES.
It will be convenient at this stage to examine the conditions
prevailing in industries which either supply materials to the
Engineering Industry or themselves use machinery and other pro-
duets of that ndustrv or hoth
ACCUMULATION OF EXTERNAL FACTORS.
An examination of these conditions will show not only that the
depression and unemployment are general, but also that there
must be in those industries causes of unemployment and high costs
which contribute to the high costs and unemployment in the
Engineering Industry. For instance, when, owing to the high cost
of materials, coal, iron, steel, etc., which it uses, the Engineering
Industry has its own costs put up, then it must, as already
explained, charge higher prices for its products which it sells to
the “industries which supply those materials.
Also, when, owing to these high costs, the Engineering Industry
is unable to export to other countries, Transport Industries suffer
becanse thev-are not given so manv Iingineering products to carry.
It is important to notice that in all industries some proportion
of the cost of production is external, and this proportion
‘ncreases as the industry assumes a more finished character.
An industry cannot of its own accord reduce these external costs
sither bv negotiation with the Trades Unions or in anv other way.
To take an elementary example : if the local rates payable on a
factory are £1,000 in a year and 1,000 similar articles are produced,
the cost of rates on each article is £1. But if, owing to trade
depression, high costs or any other cause, the factory only pro-
duces 500 articles, then the cost of rates on each article is £2 and
the charge to the buyer must go up £1. On the other hand, if
the factory can produce and sell 2,000 articles, then the cost of
rates on each article is only 10s., the charge to the customer can be
10s. less, and obviously the likelihood of selling is so much the
Yettor
