Official Labour Statistics: A Historical Perspective

Official Labour Statistics: A Historical PerspectiveAuthor(s): Roger DavidsonSource: Journal of the Royal Statistical Society. Series A (Statistics in Society), Vol. 158, No. 1(1995), pp. 165-173Published by: Wiley for the Royal Statistical SocietyStable URL: http://www.jstor.org/stable/2983410 .

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J. R. Statist. Soc. A (1995) 158, Part 1, pp. 165-173

Official Labour Statistics: a Historical Perspective By ROGER DAVIDSONt University of Edinburgh, UK

[Received October 1993. Revised March 1994]

SUMMARY This paper explores some of the social and economic forces shaping the development of official labour statistics in Britain a century ago. It examines the competing fears and ideologies that fuelled the demand for intelligence about the labour market and the major constraints on its provision, such as Treasury control, industrial resistance and the lack of co-ordination between the statistical branches of government. The broader impact of official labour statistics on social politics is discussed in both a British and an international context, with particular reference to the problems of industrial unrest, unemployment and low income destitution. The paper uses a historical perspective to demonstrate the continuing significance of past investigations to British labour statistics.

Keywords: HISTORICAL PERSPECTIVE; INDUSTRIAL UNREST; LOW INCOME DESTITUTION; OFFICIAL LABOUR STATISTICS; UNEMPLOYMENT

1. INTRODUCTION

'Went to Polytechnic . . . thence to Board of Trade Labour Bureau and saw new number of Labour Gazette and an excellent number it is' (extract from the diary of John Burns, Liberal Member of Parliament and member of the Trades Union Congress Parliamentary Committee, May 31st, 1893).

'That Labour Gazette . . . is the most perfect compendium of all the facts that will interest labour that has ever been drawn up. If this Government had existed only for the purpose of producing the Labour Gazette, I venture to say this Government would not have lived in vain' (extract from Lord Rosebery's speech as Prime Minister at St James's Hall, March 22nd, 1894).

After a century of the Labour Gazette, it is perhaps fitting to explore some of the main forces that shaped the emergence and early format of official labour statistics in Britain. This is especially so given the strong commitment to historical continuity in British official statistics and their deference to the fears and pre- occupations, and to the investigative agenda of past administrators. Just as our census classifications have been shown to be derived from the social concerns and assumptions of the national efficiency debate in the early years of the 20th century (Szreter, 1974), so much of the configuration of modern labour statistics originated in the perceptions of crisis of the late-Victorian and Edwardian governing classes.

2. THE IMPULSES

Four major areas of concern prevailed: the breakdown of industrial relations, the apparent crisis in inner city areas, the decline in competitive performance of

tAddress for correspondence: Department of Economic and Social History, University of Edinburgh, William Robertson Building, 50 George Square, Edinburgh, EH8 9JY, UK. E-mail: [email protected]

? 1995 Royal Statistical Society 0035-9238/95/158165



166 DAVIDSON [Part 1,

the British economy and the on-going problems of poverty and unemployment occasioned by income inequalities and the business cycle.

The emergence of more aggressive management strategies after 1880 in the face of declining world prices, combined with the rise of a more militant unionism, threatened to produce major industrial confrontation at the expense of social stability and economic growth. There resulted in Westminster and Whitehall a rising demand for information on wage rates and methods of remuneration, on the incidence of unionization and industrial unrest, and on methods of collective bargaining. In addition, anxiety over the alleged process of 'urban degeneration' produced a spate of investigations and statistical series by the Labour Department on unemployment, underemployment and sweated labour. Concern over Britain's commercial performance and the heated debate over tariff reform underpinned other enquiries into comparative labour costs, unemployment and productivity, as well as legislation affecting working conditions and efficiency in rival economies. Meanwhile, the 'poverty debate', fuelled by the findings of Booth and Rowntree, lent urgency to the first major governmental inquiries into working-class expenditure and costs of living: enquiries that were to provide the template for subsequent standard of living investigations and cost of living indices undertaken by the Ministry of Labour (Davidson, 1985a; Harris, 1972; Hennock, 1976, 1987; Stedman Jones, 1971).

In many respects, in responding to these perceptions of crisis, the Labour Gazette, first published by the newly established Labour Department of the Board of Trade in May 1893, carried on the utilitarian belief in a rational, informed state as a means of ensuring social harmony and a limited and economical government. Rather than the raw material for state intervention, labour statistics were viewed by many late-Victorian politicians, civil servants and social scientists as the first condition of self-help: a basis for voluntary and associative action whether it be industrial conciliation or the regulation of working conditions. Thus, to Charles Bradlaugh, one of the leading advocates of the Labour Department, its primary function was to sustain British individualism against the bogeys of Russian nihilism and German socialism by revealing the identity of interests between capital and labour. Similarly, Sir Robert Giffen, the Board of Trade's chief economist and statistician, viewed intelligence about labour as a means of countering socialist propaganda on the conditions of the working-classes, of eliminating 'irrational conflict' and of securing 'efficient and economical' administration (Giffen, 1891). Giffen's commitment to liberal individualism was widely recognized as constraining the early editorial policy of the Labour Gazette.

Yet, as in many other countries, official labour statistics were not merely a function of a bureaucratic agenda within Whitehall. A concern for improved intelligence about society and the labour market was common to a range of the ideologies shaping the social politics of the period. For example, central to the collectivist theories of the national efficiency school and to Fabianism was the belief in a government of experts guided by comprehensive information on the economy and labour force. Indeed, the Webbs had played an active role in the establishment of the Labour Department of the Board of Trade, and, before her celebrated partnership with Sydney Webb, Beatrice Potter had contemplated a 'working partnership' with Hubert Llewellyn Smith, subsequently to become the first Labour Com- missioner in charge of the Department. Similarly, both Social Darwinism and the



1995] OFFICIAL LABOUR STATISTICS 167

Eugenics Movement assumed a proactive, inquisitorial role for the state in labour issues as the basis for social engineering and reform. Above all, the New Liberalism of the Edwardian period called for a thorough inventory of labour as well as capital to address the 'crisis of distribution' within British society and to regulate resources for the optimum welfare of the community (Searle, 1971; Mackenzie, 1981; Freeden, 1978).

3. THE CONSTRAINTS

British labour statistics have not only been shaped by the social politics and panics of an earlier age. Evidence suggests that many of the constraints operating on the statistical work of the Labour Department and reflected in the Labour Gazette have also survived well into the second half of the 20th century. An enduring obstacle was Treasury control. The Treasury view, first articulated in the 1880s, was that statistical investigation by government departments had to be 'carefully watched' in view of its 'dangerous tendency to magnify work and extend functions beyond the limits required at once by economy and expediency' (Public Record Office, 1882). Such fears were reinforced by the radical connections of many investigators attached to the Labour Department, which the Treasury viewed as 'a permanent conspiracy to extravagance'. As Sir Charles Dilke aptly observed in 1907, in terms of their claims on public expenditure, social statisticians within Whitehall were essentially regarded by the Treasury 'in the light of sturdy beggars'. As a result, many of the statistical series produced by the Labour Department were unduly restricted, not least the indices relating to working-class earnings, patterns of consumption and costs of living. Recent research has documented the degree to which such constraints continued to operate on the work of the interwar Ministry of Labour, compromising the intelligence about trade unions and employment available to government and delaying the much needed revision of the official cost of living index. As Rodney Lowe has concluded, 'for the sake of easy, short-term economy, the Treasury was prepared to sacrifice the statistical foundations of policy-making' (Lowe, 1986).

Industrial resistance to the provision of labour force and labour market information was an additional constraint. In part, this merely reflected the predictable resistance of busy industrialists and trade union leaders to time-consuming, bureaucratic questionnaires. In part, however, it reflected fairly deep-rooted ideological distrust of official labour statistics. Many union leaders objected to the disclosure of information on membership, financial resources and unemployment for fear that it would enable 'employers to know when to put the screw on'. They were also concerned that data on working-class expenditure patterns would provide an excuse for middle class moralizing over misallocation of expenditure and a diversion from the real problems of low income destitution. In contrast, many businessmen feared that workforce data would be used by Whitehall to interfere with private enterprise and fuel left-wing proposals for a range of costly welfare measures. The vitriolic response of one industrialist in 1912 to a request for data is illustrative:

'This is an utterly futile return.... Some idiot is hard up for employment and has hit upon this brilliant idea to give overpaid and underworked officials a chance of wearing out government pens and filling government foolscap with rubbish. Your department is




the last refuge of the decrepit trade union official or the out at elbows socialist orator' (Public Record Office, 1912).

According to the industrial correspondent of The Times, refusal by some employers to submit returns to the Labour Department was 'so much a matter of routine' that they were even 'said to make it with the help of a rubber stamp'.

We must remember that many of the leading labour investigators and statisticians within the Labour Department before 1914, who produced the Labour Gazette and the array of pioneering reports and abstracts on labour issues, had formerly been labour activists and trade union leaders. For example, John Burnett, Chief Labour Correspondent of the Labour Department, had been a former General Secretary of the Amalgamated Society of Engineers, and one of the fiercest activists in the north-east in the 1870s, while Hubert Llewellyn Smith had been closely involved in the match girl strike of 1888 and the dock strike of 1889. The bulk of the fee- paid local labour correspondents retained by the Board of Trade were also trade unionists. Such appointments had initially been made by the progressive wing of the Liberal government of 1892-94 to establish the credibility of official statistics in labour circles. In the event, while infuriating employers' associations such as the Liberty and Property Defence League, they merely raised false hopes within the labour movement, with predictable disillusionment when it became evident that labour investigators within Whitehall were to be permitted little room to fulfil their more radical tendencies.

The scope of early British labour statistics was also limited by a continuing lack of co-ordination within the government's statistical services, despite the efforts of the Board of Trade, backed by the Royal Statistical Society, to press for a Central Statistical Office. As a result, a large amount of information relating to the labour market and to destitution was scattered in a range of departments such as the Home Office and the Local Government Board and could not readily be cross-tabulated with the data collected by the Labour Department to provide an overview of social problems. For example, although the Local Government Board recorded the incidence of pauperism and the Board of Trade monitored unemployment and wage-earnings, no agency was responsible for investigating poverty per se, and it was left to the private enterprise of social scientists such as Charles Booth and Arthur Bowley to make good the omission. A wealth of information relating to working conditions, remuneration and industrial unrest lay dormant in the routine reports of the factory, mines and workshop inspectorates. Similarly, Labour Department data were rarely collated with the information on labour mobility and destitution gathered by the Poor Law Inspectorate and local guardians.

Another limiting feature was the failure of the methodology employed in many labour investigations to keep pace with contemporary advances in quantitative techniques and statistical theory in spite of the fact that the Board of Trade regularly employed statistical consultants, such as Arthur Bowley and Udny Yule, who were closely associated with the rise of sociometrics and the use of sampling theory. In consequence, although publications such as the Labour Gazette were innovative in the construction and presentation of time series on issues such as unemployment and wage earnings, correlation and regression techniques were conspicuously absent, as was the use of random sampling.

Recent research paints a very similar picture for the interwar period. Although




the Ministry of Labour was 'tempted to dip, very tentatively, into the uncertain waters of sampling', much of the more sophisticated data and theoretically informed analysis on working-class conditions continued to be produced outside government (Kent, 1981; Supple, 1993). The work of Lowe (1986) and Garside (1980) suggests that, although the coverage of labour statistics may have broadened between the wars, their technical calibre remained remarkably static, a view readily endorsed by even a cursory comparison of the early issues of the Labour Gazette with those of the Ministry of Labour Gazette in the late 1930s. Indeed, the archives of the Royal Statistical Society for the 20th century reveal a continuing campaign to upgrade the calibre of civil intelligence in Britain and to introduce new methods of quantification for social policy making and manpower planning.

Several explanations might be advanced for this relative lack of technical sophistication. Then, as now, senior officials were more concerned with the utility of data for policy briefings and public education than with statistical refinement. Another factor was the enduring resentment of civil servants, including statisticians within the traditional establishment, at the intrusion of new expertise. The lack of a pro- fessional consensus in support of the mathematical theory of statistics well into the 20th century also helped to preserve official labour statistics as a legitimate sphere for conventional investigation.

4. LABOUR STATISTICS AND SOCIAL POLITICS

However, it is arguable that the most powerful influence on the scope and sophistication of early British labour statistics was the need of the state to disseminate 'social knowledge' in the interests of social and economic stability. There was, of course, no conscious conspiracy to deploy intelligence about labour as a system of social control within market capitalism. As we have seen, the industrial elite could at times be actively resistant to the inquisitorial role of the state in the labour market. Conversely, on many occasions, socialist and trade union campaigners readily deployed data from the Labour Gazette in promoting particular causes. Yet, ultimately, politicians and civil servants produced labour statistics primarily as a means of securing 'rational' policies that did not question the fundamental structure of industry and society. The institution of a separate Labour Department with its own journal did recognize the interests of the workforce in the machinery of government, but, if we examine the categories of official labour statistics as they defined working-class experience, they treated labour primarily as a source of value and a factor of production.

The relationships explored in the Labour Gazette were market rather than welfare orientated. Typically, the focus was on the horizontal rather than vertical distribution of income and consumption; on the cost and efficiency of labour rather than the quality of life of the workforce. Significantly, the more sophisticated statistical series on working-class income and expenditure, such as the index of the cost of living of the working-classes in large towns, were designed to illuminate commercial issues such as tariff reform and comparative costs of production rather than social issues (His Majesty's Government, 1903, 1905).

Information on industrial unrest was collated and analysed to provide a database for conciliation and arbitration and to underline the essential 'irrationality' of demands that discounted the realities of the market. The rational class politics of




collective bargaining were to replace irrational disputes engendered by ignorance of the facts of economic life. Where state intervention was required under the Con- ciliation Act, intractable issues of industrial power and social equity would be translated by the conventional taxonomies of labour statistics into narrower econo- mistic issues of pay and conditions that were susceptible to negotiation (Davidson, 1985b).

Meanwhile, although official unemployment statistics were widely quoted in the welfare debates of the period, their presentation within the Labour Gazette lacked any critique of economic orthodoxies. As Beatrice Webb somewhat wistfully remarked in 1898 in her Antipodian Diaries, the use made by the editor of the New Zealand Journal of Labour to explore radical options for reducing 'want of employment' would have made 'Llewellyn Smith's hair stand on end'. In Britain, reports on the incidence and causes of unemployment were certainly produced by the Labour Department to provide a database for social reform but their terms of reference were equally dedicated to contesting the 'sensational estimates' of socialist groups such as the Fabians and Social Democratic Federation seeking to introduce contracyclical public investment programmes and a government commitment to the 'right to work'. As with its statistics on trade unions and strikes and lockouts, the Labour Department's analysis of unemployment broadly sustained a classical deference to the needs of the 'profits fund' and an implicit acceptance of the trade cycle as an inevitable corollary of economic growth (Harris, 1972). This was particularly evident in its evaluation of overseas employment strategies, ranging from labour colonies in Germany to public works programmes in New South Wales. Although the mitigation of distress from 'want of employment' was clearly Whitehall's intention, it was the impact of such schemes on the work ethic and private investment incentives that commanded most attention.

The capacity of official labour statistics to act as a catalyst for social reform while containing the scope of state intervention was perhaps best illustrated -by the Labour Department's handling of low wage destitution. In identifying low income destitution as an anomaly of a few parasitic trades characterized by homework, female employment and outdated technology rather than as a general feature of the unskilled and secondary labour market, government statistics successfully confined the concept of statutory minimum wages before the First World War to a few isolated trade boards. To a limited extent, in the Labour Gazette and elsewhere, the Labour Department furnished a profile of working-class earnings and of wage rates in what were perceived as 'sweated trades' (Schmiechen, 1984), but earnings and cost of living data were consciously not presented so that they defined a sub- sistence wage or official poverty line that might have formed the basis of more systematic intervention by the state in the process of wage determination.

5. INTERNATIONAL PERSPECTIVE

Recent comparative studies of the rise of the 'knowledge state' have further illuminated the impact of labour statistics on social and industrial politics. The genesis of official labour statistics in Britain in the late 19th century was paralleled by similar developments in western Europe and the USA (Choi, 1989; Furner, 1993). In France, for example, in July 1891, the Office du Travail was created within the Ministry of Commerce and Industry. As with the Labour Department, the Office




du Travail published annual abstracts of labour statistics as well as a monthly bulletin, instituted in 1894. The earliest French labour market reports were also driven by a concern to facilitate collective bargaining and to address the increasingly sensitive issue of unemployment. As in Britain, there was tension between social radicals who advocated an expanded, proactive role for government investigation and more conservative forces backed by financial bureaucrats who feared that it would endanger private enterprise and free-market principles. As in Britain, but to an even greater extent, the early state administration of labour statistics in France was staffed by former trade union and socialist activists including Isidore Finance and the syndicalist Fernand Pelloutier (Choi, 1989; Luciani and Salais, 1990).

In the USA, similar patterns of government growth can be discerned; the social politics surrounding economic depression and growing industrial unrest spawned the Federal Bureau of Labour in 1884, headed by Carroll D. Wright. In November 1895, a bulletin was first published with a similar mission statement to that of the Labour Gazette: to eschew propaganda and to provide a rational solution to the so-called 'labour problem'. As in France and Great Britain, the early radical roots and recruitment patterns of state and federal labour bureaus in the USA led to a later backlash from Congress and employers after 1900 with inevitable constraints on funding and the scope of enquiry (Furner, 1993; Leiby, 1960).

Any overarching theory of the role of labour statistics in the modern state based on such international comparisons has necessarily to be tentative. However, recent research has speculated that the contribution of labour statistics to the rise of rational class politics in western Europe may in part help to explain the Marxist problematic of how the capitalist state has survived despite its apparent contra- dictions (Choi, 1989). It is arguable that, although 'alternative' labour statistics were produced (as with the Fabian Tracts in Britain and the syndicalist cost of living data in France), and although official statistics might be used in ways quite unfore- seen by government statisticians, the fact that they became the language of inter- action and negotiation moderated working-class behaviour and confined the class struggle within the context of rational policy making.

This was not merely a process of subordinating labour interests. The establishment of separate administrative provision for labour statistics provided important institutional recognition of the interests of labour. Official labour statistics often furnished the ammunition for more effective collective bargaining, and for mobiliz- ing public support for the on-going struggle for social reform and improved working conditions. None-the-less, the use of labour statistics as a common discourse brought pressure on labour organizations to bureaucratize, to shift the centre of gravity between charisma and calculation, zealotry and expertise and a command of the facts, and to define constituency interests in orthodox economic categories relating to immediate shifts in economic conditions that were negotiable. As a result, it is argued that the labour movement adopted strategies of short- and medium-term reformism based on issues defined and mediated through the language and configuration of official statistics, rather than open confrontation with employers and the state.

The American experience does not fit quite so comfortably with this hypothesis. Before the 1930s, industrialists preferred open conflict rather than rational negotiation with the unions. They distrusted the State and Federal Labour Bureaus, viewing them as hotbeds of left-wing activism, and, where they did undertake




research into the labour market, they opted to fund independent investigations such as those undertaken by the American Bureau of Industrial Research in Wisconsin. In the 1880s and 1890s, union leaders were certainly avid consumers of the new labour statistics in their quest for legal recognition and decent working conditions, but thereafter they appear to have used them less consistently than their European counterparts. This was due in part to the more distant relationship in the USA between the labour unions and the Bureau of Labor Statistics, to the broader social constituency of the Knights of Labour (incorporating farmers as well as significant portions of the middle classes) and to the inevitable diversion of official investigations into racial issues. It also stemmed from the alienation of the American labour movement from areas of investigation undertaken by the early labour bureaus whose focus on moral statistics of intemperance, crime and prostitution appeared to question the validity of working-class demands. According to Choi (1989), it was only during the New Deal that legal and other confrontational strategies between industrialists and workers came to be complemented by rational discourse based on statistical evidence rather than the assertion of constitutional and property rights.

6. CONCLUSION

A century ago, A. J. Mundella, President of the Board of Trade, confided that: 'My Labour Department is a big thing- larger and more important, in my opinion, than the Government itself apprehends. It will do great work in the future.'

He could little have imagined the vast expansion in government growth over the next 25 years that was to be underpinned by the civil intelligence of the Department, including industrial conciliation and arbitration machinery, a system of labour exchanges and unemployment insurance, and the provision of trade boards, and culminating in the creation of the Ministry of Labour. 100 years on, the scope and sophistication of that intelligence is of course very different. The first edition of the Labour Gazette with its adverts for Salvation Army 'Lights in darkest England' phosporus-free matches, Clotten's automatic 'peat-dust' anti-cholera dry closets, and Ward's three-wheel 'Victoria Bath Chair' is evocative of another age. Yet, as this paper has hinted, many of the forces shaping official labour statistics at the turn of the century have long continued to operate. The purpose of labour statistics is still dominated by the issues of industrial relations, unemployment, casual labour and low pay. Constraints such as Treasury control and the compartmentalization of official statistics continue to delimit the investigative work of government, and radical commentators still question the ability of official information, whether it be unemployment or cost of living data, to address the systemic labour problems of industry. In placing British official labour statistics in historical perspective, we can therefore go some way towards explaining and demystifying the database that informs so much of the social politics of modern Britain.

ACKNOWLEDGEMENTS

I am indebted to Peter Stibbard, Director of Statistics, Department of Employ- ment, and Ralph Turvey, Visiting Professor, London School of Economics and Political Science, for their comments. I am also indebted to the Economic and Social




Research Council whose financial assistance made possible much of the original research on which this paper is based.

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Official Labour Statistics: A Historical Perspective