Tuesday, November 12, 2013

Creation of the Middle Class

Henry Ford pioneered the assembly line. In 1912 it took Ford 1,260 man-hours to produce a Model T.  When the company adopted the electrified assembly light it brought a big leap in industrial productivity. In 1914 it took 617 man-hours. As the line's operation was fine tuned by 1925 it took 228 man-hours.  

Ford also led the way to boosting blue collar wages. One day Ford announced he would double workers' pay---to five dollars a day---across the board. He saw the higher wages were necessary to convince large numbers of men to take factory jobs that had become numbingly tedious---to discourage them from quitting those jobs. Workers would train, become bored and quit. Continual training was expensive to the company. In response to the increase 15,000 workers applied for 3,000 open slots. Other factory owners, with no options also raised wages.

As factory jobs came to require less skill, they began to pay higher wages. And that helped set in motion one of the most important social developments of the century: the creation of a vast, prosperous American middle class.

 

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