(c) The Classes of Establishments in the Production and Distribution of Social Wealth

General statistics are wanting of the classes of enterprises in industry as regards England which is considered the most advanced of the European countries in capitalist production. They exist only for certain branches of production placed under the Factory Laws and for individual localities.

In the factories and workshops coming under the Factory Laws there were engaged, according to the Factory Inspector’s report for 1896, altogether 4,398,983 Persons. That is not quite half the number given as actively engaged in industry according to the census of 1891. The number in the census, omitting the transport trade, is 9,025,902. Of the 4,626,919 remaining persons, we can reckon a fourth to a third as tradesmen in the branches of production referred to, and in some medium-sized and large businesses which do not come under the Factory Laws.

There remain in round numbers 3,000,000 employees and small masters in minute businesses. The 4,000,000 workers under the Factory Laws were distributed among 160,948 factories and workshops which yields an average of twenty-seven to twenty-eight workers per establishment.

If we deal with factories and workshops separately we get 76,297 factories with 3,743,418 employees and 81,669 workshops with 655,565 employees, on the average forty-nine workers to a factory and eight to a registered workshop.

The average number of forty-nine workers to a factory already shows what the closer examination of the tables of the report confirms, that at least two-thirds of the businesses registered as factories belong to the category of medium-sized businesses with six to fifty workers so that at the most 20,000 to 25,000 businesses of fifty workers and more remain which may represent, on the whole, about 3,000,000 workers. Of the 1,171,990 persons engaged in the transport trade only three-quarters can be considered at the most as belonging to large enterprises. If we add these to the foregoing categories we get a total for the workers and the auxiliaries of the large industries of between 31 and 4 millions, and against these stand 51 millions of persons engaged in medium and small businesses. The “workshop of the world” is, accordingly, far from being, as is thought, in the stage of containing only large industries. Enterprises show the greatest diversity in size also in the British Empire, and no class of any size disappears from the scale.

If we compare with the above figures those of the German industrial census of 1895, we find that the latter, on the whole, shows the same picture as the English. The great industries occupied nearly the same position in relation to production in Germany in 1895 as in England in 1891. In Prussia in 1895, 38 per cent. of the industrial workers belonged to the large industries. The development of large undertakings has been accomplished there and in the rest of Germany with extraordinary speed. If certain branches of industry (among them the textile) are in this respect still behind England, others (machines and implements) have reached the English position on the average, and some (the chemical and glass industries and certain branches of the printing trades, and probably also electric engineering) have overtaken it. Still the great mass of persons engaged in industry belong also in Germany to small and medium undertakings. Of the 10¼ million persons engaged in industry in 1895 something over 3 millions were found in large undertakings, 2½ millions in medium-sized undertakings (6 to 50 persons), and 41 millions in small ones. Master artisans still numbered 1¼ millions. In five trades their number, as against that of 1882, had increased absolutely and relatively (to the increase of population), in nine only absolutely, and in eleven it had declined absolutely and relatively.

In France industry still keeps behind agriculture in numbers of workpeople employed. According to the census of April 17th, 1894, it represented only 25.9 per cent, of the population, and agriculture nearly twice as much – namely, 47.3 per cent. Austria shows a similar ratio, where agriculture takes 55.9 per cent. of the population and industry 25.9 per cent. In France there were one million persons working for themselves to 3.3 million employees, and in Austria 600,000 of the former to 2¼ million workmen and day labourers. Here the ratio is also very much the same. Both lands show a series of highly-developed industries (textile, mining, building, etc.), which, with respect to the size of the industry, compete with the most advanced countries, but which are only a portion of the industrial life-work of the nation.

Switzerland has, with 127,000 persons working for themselves, 400,000 employees. The United States of America, which the contributor to the New York Volkszeitung above referred to says is the most developed capitalist country in the world, certainly had, according to the census of 1890, a comparatively high average of workers per establishment-namely, 3½ million workers to 355,415 industrial establishments, i.e., 10 to 1. But the home and small industries are wanting here, just as in England. If one takes the figures of the Prussian industrial statistics from the top downwards, one gets almost exactly the same average as that of the American census. And if one studies more closely the Statistical Abstract of the United States, one comes upon a great number of manufacturing concerns with, on an average, five or fewer workers to the establishment. On the very first page we have 910 manufactories of agricultural implements with 30,723 workers, 35 ammunition factories with 1,993 workers, 251 manufactories of artificial feathers and flowers with 3,638, 59 manufactories of artificial limbs with 154, and 581 sail-cloth and awning factories with 2,873 workers.

If the continual improvement of technical methods and centralisation of businesses in an increasing number of branches of industry is a fact whose significance scarcely any crazy reactionaries can hide from themselves, it is a no less well-established fact that in a whole series of branches of industry small and medium-sized undertakings appear quite capable of existing beside the large industries. In industry there is no development according to a pattern that applies equally to one and all branches. Businesses carried on throughout according to routine, continue as small and medium-sized undertakings, whilst branches of technical trades which were thought to be secured for small businesses are absorbed for ever one fine day by a large organisation.

A whole series of circumstances allows the continuance and renewal of small and medium enterprises. They can be divided into three groups.

First, a great number of trades or branches of trades are nearly equally adapted for small and medium undertakings as for large enterprises, and the advantages which the latter have over the former are not so important that they can outweigh the peculiar advantages of the smaller home industries. This is, as everyone knows, the case, amongst others, with different branches of wood, leather, and metal work. Or, a division of labour is found where the large industry carries out one-half and three-quarters of the manufacture and when the finishing processes are done by smaller enterprises.

Secondly, when the product must be made accessible to the consumer, small establishments are, in many cases, favourable to its manufacture, as is shown most clearly in bakeries. If only the technical side was concerned, baking would long ago have been absorbed by the large industries, for the many bread factories yielding a good profit show that they can be carried on with good results. But in spite of, or beside, them and the cake factories which are gradually winning a market, the small and medium-sized bakeries hold their ground owing to the advantage they offer for trade with consumers in their vicinity. The master bakers are sure of their lives for some time to come as far as they have to reckon only with capitalist undertakings. Their increase since 1882 has certainly not kept step with the increase of population, but is still worth mentioning (77,609 as against 74,283).

But baking is only an extreme example. For a whole series of trades – namely, where production and service performing labour are mixed – the same thing holds good. We will mention here the farrier and wheelwright trades. The American census shows 28,000 farrier and wheelwright businesses with a total of 50,867 persons, of which just one-half are masters. The German trade statistics show 62,722 blacksmiths and farriers; and it will certainly be a good while before the automatic vehicle driven by steam power, etc., will extinguish their spark of life in order to breathe life into new small workshops, as everyone knows bicycles have done. Similarly with the trades of tailors, shoemakers, saddlers, carpenters, carpetmakers, watchmakers, etc., where work for customers, and, in varying degree, repairing or shopkeeping, will keep alive independent existences of which certainly many, but not all, by any means, represent only proletarian incomes.

Last, but not least, the large industry itself gives life to smaller and medium trades partly by production on a large scale producing a corresponding cheapening of materials of work (auxiliary materials, half-manufactured goods), partly by the liberating of capital, on the one hand, and the “setting free” of workers on the other. In great and small amounts new capital is always entering the market seeking utilisation, and the demand on the market for new goods increases steadily with the wealth of the community. Here the shareholders mentioned earlier play no small part. The market could not, in fact, live on the handful of millionaires even if the “hand” counted some thousand fingers. But the hundreds of thousands of rich and well-to-do have something to say to it. Nearly all the articles of luxury for these classes are, in the beginning – and very many also later on – manufactured in small and medium businesses, which, however, can also be capitalistic businesses, according as they work upon dear materials and use costly machines (manufacture of jewellery, work in fine metals, art embroidery). It is only later that the large industry (when it does not itself take over the articles referred to), by cheapening the materials of work, “democratises” the one or the other new luxury.

In spite of the continued changes in the grouping of industries and the internal organisation of the establishments, we have this picture on the whole to-day : that the large industry does not continuously absorb the smaller and medium industries, but that it is growing up beside them. Only the very small enterprises decline relatively and absolutely. But as regards the small and medium industries they do increase, as is shown for Germany by the following figures for employees in trades:

Increase per cent

Small businesses (1-5 persons)

Small medium businesses (6-10 persons)

Greater medium businesses (11-50 persons)

The population increased in the same period by 13.5 per cent only.

Although in the interval treated the large industries increased their armies at a still greater rate – by 88.7 per cent – that has only meant in isolated cases the total absorption of the small businesses. In fact, in many cases no – or no more – competition takes place between large and small enterprises (think of the great works for making machinery and bridges). The example of the textile industry, which is commonly brought into our literature, is in many respects misleading. The increase of productivity which the mechanical mule represents over the old spindle has only recurred now and again. Very many large undertakings are superior to small or medium businesses, not on account of the higher productivity of the labour employed, but simply from the size of the undertaking (building of ships), and they leave the spheres of business of the small industries quite, or, to a great extent, untouched. He who hears that Prussia in the year 1895 saw nearly double as many workers occupied in large industries as in 1895 ; that these in 1882 were only 28.4 per cent., but in 1895 were 38 per cent. of the total number employed in all trades, might easily fancy that small industries would soon be a thing of the past, and that they had played their part in the social economy. The figures quoted show that the rapid extension and expansion of large industries represent only one side of social development.

As in industry so in commerce. In spite of the shooting up of the large warehouses the medium and small commercial businesses maintain their footing. We are, of course, not concerned here with denying the parasitic element in commerce, particularly as regards the so-called small retail business. Nevertheless, it must be observed that also with regard to that, much exaggeration has crept in. Wholesale production and the steadily increasing intercourse all over the world are always throwing greater quantities of commodities on the market which in some way or other must be brought to the consumer. Who would deny that this could take place with less expenditure of labour and cost than by the present retail trade? But as long as it does not take place this kind of trade will persist. And just as it is an illusion to expect from the large industries that they will absorb in a short time the small and medium industries, so is it also Utopian to expect from the capitalistic warehouses an absorption to a considerable extent of medium-sized and small shops. They injure individual businesses and here and there temporarily bring the whole of the small trades into confusion. But after a time the latter find a way of competing with the large shops and of making use of all the advantages which local associations offer them. Fresh specialising and fresh combining of businesses are begun, new forms and methods of carrying on business are started. The capitalistic warehouse is far oftener a product of the great increase of the abundance of goods than an implement of the annihilation of a parasitic small trade. It has had more effect in rousing the latter from its routine and breaking it of certain monopolist customs than in exterminating it.

The number of shop businesses increases steadily; it rose in England between 1875 and 1886 from 295,000 to 366,000. The number of persons employed in commerce rose still more. As the English statistics under this heading were taken on a different basis from those of 1881 , we will take the figures from the Prussian statistics.

There were in Prussia in shops and carrying trades (excluding railways and post office business):

Increase Per cent

In businesses with 2 and fewer assistants

In businesses with 3-5 assistants

In businesses with 6-50 assistants

In businesses with 51 assistants and more

The increase is proportionately the greatest in the large businesses, but these do not represent much more than 5 per cent. of the whole. It is not the large businesses that offer the most deadly competition to the small ones; the latter provide it among themselves. But in proportion there are not very many corpses. And the scale of businesses remains unhurt in its composition. The small medium-sized shops show the greatest increase.

Finally, when we come to agriculture, as far as concerns the size of separate undertakings, we meet, in our times, with a movement all over Europe, and partially in America, which apparently contradicts everything that the socialistic theory has hitherto advanced. Industry and commerce showed only a slower movement upwards in large undertakings than was assumed, but agriculture shows a standing-still or a direct retrogression in regard to the size of holdings.

As regards Germany, the census of occupations taken in 1895, as against 1882, shows the relatively greatest increase in the group of peasant medium-sized holdings (5 to 10 hectares)-namely, 8 per cent. – and still greater is the increase in the area covered by the whole of them – namely, 8 per cent. The peasants’ small holdings following next below them (2 to 5 hectares) show the next greatest increase: 3.5 per cent. increase in the number of holdings and 8 per cent. increase in extent of land held. The very small holdings (allotments) (under 2 hectares) have an increase of 5.8 per cent. in number and 12 per cent. in land occupied, yet the portion of this land used for agricultural purposes shows a diminution of 1 per cent. The holdings already partially capitalistic (10 to 100 hectares) show an increase of not quite 1 per cent., which falls to the land cultivated as forest, and an increase of not quite 2 per cent. is shown by the large holdings (more than 100 hectares).

Here are the figures referred to for 1885:

Kind of Holding

No. of Holdings

No. of hectares used for agricultural purposes

Total extent in hectares

Very small (2 hectares and under)

Small peasants’ holdings (2-5 hectares)

Medium(5-20 hectares)

Large (20-100 hectares)

Large holdings (100 hectares & upwards)

Over two-thirds of the total area fall under the three categories of peasant farms, about one-third under large holdings. In Prussia the proportion of peasant holdings is even more favourable; they occupy nearly three-fourths of the agricultural area – 22,875,000 out of 32,591,000 hectares.

If we turn from Prussia to its neighbour, Holland, we find:

Holdings

Area of Holding

Increase or decrease

Per cent

1-5 hectares

Over 50 hectares

Here the large holdings have actually decreased and the small medium peasants’ holdings have considerably increased.

In Belgium, according to Vandervelde , the ownership of the land as well as the occupation of the soil has yielded to a continued decentralisation. The last general statistics show an increase of owners of land from 201,226 in the year 1846 to 293,524 in the year 1880; an increase also of tenants of land from 371,320 to 626,872. The total cultivated agricultural area of Belgium consisted in 1880 of not quite 2,000,000 hectares, of which over one-third were cultivated by their owners. The division of agricultural allotments reminds one of the Chinese agrarian conditions.

France in the year 1882 had the following agricultural holdings:

Holdings

Extent of Holding

Under 1 hectare

1,083,833 hectares

1-10 hectares

11,366,274 hectares

10-40 hectares

14,845,650 hectares

40-100 hectares

22,266,104 hectares

100-200 hectares

200-500 hectares

Over 500 hectares

Of the holdings between 40 and 100 hectares there are in round numbers 14 million hectares, and of those over 200 hectares 8,000,000, so that, on the whole, the large holdings represent between a fifth and a sixth of the agriculturally cultivated area. The smaller, medium, and large peasants’ holdings cover nearly three-quarters of French soil. From 1862 to 1882 the holdings of 5 to 10 hectares had increased by 24 per cent; those between 10 and 40 acres by 14.28 per cent. The agricultural statistics of 1892 show an increase of the total number of holdings of 30,000, but a decrease in the last-named category of 33,000, which shows a further sub-division of holdings of land.

But how does it stand in England, the classic land of large ownerships of land and of capitalistic farming of the soil? We know the lists of mammoth landlords which from time to time appear in the press as an illustration of the concentration in the ownership of land in England, and we know the passage in Capital where Marx says that the assertion of John Bright that 150 landlords own the half of British land and 12 the half of Scottish, has not been denied. Now, though the land of England is centralised by monopolists, it is not so to the extent that John Bright pronounced. According to Brodrick’s English Land and English Landlords there were out of the 33 millions of acres of land in England and Wales entered in Domesday Book, 14 millions, in round numbers, the property of 1,704 landlords with 3,000 acres each or more. The remaining 19 million acres were divided among 150,000 owners of one acre and more, and a large number of owners of small plots of land. Mulhall gave, in 1892, for the whole of the United Kingdom, 176,520 as the number of owners of more than 10 acres of land (altogether ten-elevenths of the area). How is this soil cultivated? Here are the figures of 1885 and 1895 for Great Britain (England, with Wales and Scotland, but without Ireland), changed into hectares for the sake of more convenient comparison.

These were enumerated:

Holdings

Increase or decrease

2-20 hectares

Over 200

Here, too, is a decrease of the large and the very large holdings and an increase of the small and medium-sized ones.

The figures, nevertheless, tell us nothing of the cultivated area. Let us complete them by the figures of the different areas coming under the various classes of holdings. They make a positively bewildering picture. There were in Great Britain in 1895:

Acres

Percentage of Total area

Holdings under 2 hectares

Holdings of 2-5

over 400

According to this 27 to 28 per cent. of the agricultural land of Great Britain is in large holdings, and only 2.46 per cent. is in very large holdings. On the other hand, over 66 per cent. is in medium and large peasants’ holdings. The proportion of the peasant holdings (where, nevertheless, capitalistic large peasant holdings predominate) is greater in England than in the average in Germany. Even in England proper the holdings between 5 and 120 hectares comprise 64 per cent. of the cultivated area, and nearly 13 per cent. of the area only is in holdings of over 200 hectares. In Wales, quite apart from small allotments, 92 per cent., in Scotland 72 per cent, of the holdings are peasant holdings of between 2 and 200 hectares.

Of the cultivated area, 61,014 holdings with 4.6 millions of acres of land were the property of their cultivators, 19,607 holdings were partly the property and partly leased, and 439,405 holdings only were on leased land. It is well known that in Ireland the small peasant class or small tenant class predominates. The same holds good for Italy.

There can, then, be no doubt that in the whole of Western Europe, as also in the Eastern States of the United States, the small and medium agricultural holding is increasing everywhere, and the large and very large holding decreasing. There is no doubt that the medium holdings are often of a pronounced capitalistic type. The concentration of the enterprises is not accomplished here in the form of annexing an ever greater portion of land to the farm, as Marx saw in his time , but actually in the form of intensification of the cultivation, changes in cultivation that need more labour for a given area, or in the rearing, etc.) of superior cattle. It is well known that this is to a large extent (not altogether) the result of the competition between the agricultural states or agricultural territories of Eastern Europe and those over the seas. Also these latter will be in a position for a good while yet to produce corn and a number of other products of the soil at such cheap prices that a substantial disarrangement of the factors of development is not to be expected from a change in this respect.

Although the tables of statistics of income in the most advanced industrial countries may partly register the mobility, and with it the transitoriness and insecurity, of capital in modern economy, and although the incomes or fortunes registered may be to an increasing extent paper possessions which a vigorous puff of wind could indeed easily blow away; yet these rows of incomes stand in no fundamental opposition to the gradation of economic unities in industry, commerce, and agriculture. The scale of incomes and the scale of establishments show a fairly well-marked parallelism in their divisions, especially where the middle divisions are concerned. We see these decreasing nowhere, but, on the contrary, considerably increasing everywhere. What is taken away from them from above in one place they supplement from below in another, and they receive compensation from above in one place for that which falls from their ranks below. If the collapse of modern society depends on the disappearance of the middle ranks between the apex and the base of the social pyramid, if it is dependent upon the absorption of these middle classes by the extremes above and below them, then its realisation is no nearer in England, France, and Germany to-day than at any earlier time in the nineteenth century.

But a building can appear outwardly unchanged and substantial and yet be decayed if the stones themselves or important layers of stones have become rotten. The soundness of a business house stands the test of critical periods; it remains, therefore, for us to investigate what is the course of the economic crises which are peculiar to the modern order of production, and what consequences and reactions are to be expected in the near future from them.