Background
Why did the NPA study the industrialization of the South?:
They were convinced that:
The South still had a great reservoir of undeveloped resources, untapped markets, and manpower available for jobs in new industries and businesses.
The nation could not attain its goals of continuing high-level employment and production with rising standards of living unless that reservoir was opened.
National policies and programs must provide a favorable environment if the South, along with other regions, were to achieve vigorous, rapid expansion. (p. v)
This is a summary of another NPA report by McLaughlinand Roback (1949). In it they surveyed 88 firms that had located in the South to figure out why.
The NPA Committee of the South felt that Southern dvelopment depended on manufacturing. Manufacturing was needed to provide jobs for farm workers made surplus by advances in agriculture.
Introduction
Early on the authors insist that southern industrial growth is "not primarily the result of northern firms pulling up stakes and moving South." (p. 2)
Rather the South had gotten a disproportionate share of industrial growth "because its markets were growing faster, its supply of raw materials were greater, and its labor supply was more plentiful than in other parts of the country." (p. 2)
They insist that of the three factors, markets were the most important and labor the least. [I would say that the relative importance of the three factors depends on the industry.]
Markets
In the case of automobile plants, they almost certainly located for better access to the market. The NPA points out that the GM and Ford plants near Atlanta used union labor and paid Detroit wage rates because of company-wide union contracts.
Materials
The South has many natural resources in abundance. This can make it attractive in five ways:
1. Where the cost of materials is lower than elsewhere. Electric power, natural gas, both important to the chemical and syn fiber businesses.
2. Where materials are closer to the market than elsewhere. Phosphates to make fertilzer and chemicals.
3. Where there is not enough material outside the South. Pulpwood.
4. Where materials can be easily developed in the South. Ag products.
5. Where research or tech advances create new uses for cheaper or more readily available southern materials. [How is this different from 1, 2, and 3?]
They go on to give examples.
Labor Supply
They claim it was not just an abundance of southern labor, but also northern labor shortages that led to southern industrial development. And not just cheap, abundant labor, but the southern workers' labor attitudes. [This gets back to the "Anglo-Saxon" thing, I suppose.]
They say they are interested not just in cheap labor, but in lower labor costs -- less turnover and absenteeism.
There's often a fair bit of sophistry in this document when they talk about labor costs. Berkshire Fine Spinning bought land in Tennessee to open a new plant. Did they move south for lower wages? Oh, no. That wasn't it.
The company stated that it was not wages that forced consideration of this section, but instead the unwillingness of its girl workers to take jobs in the mills while other northeastern jobs offered better working conditions.
Right.
Other Influences
Roads and rails. And ports.
Small towns.
Large companies which located in smaller towns did so because tgey wanted to dominate the local labor market, because of lower wage rates, or because they expected to develop better relationships with civic leaders. Some large companies said they would never locate in a small town already dominated by another industry. Reasons given: they didn't want the dreges of the labor market and such cities are "often controlled politically or otherwise by the doominating industry." (p. 26)
[Stop it! You guys are cracking me up.]
Taxes. There is a single paragraph at the end admitting that low taxes were reported as favorable by a "few companies."
National Planning Association. (1949). New Industry Comes To the South: A Summary of the Report of the NPA Committee of the South. Washington, DC: National Planning Association; Committee of the South.
Posted by Chip on June 27, 2004 at 02:48 PM | TrackBack