Cost of South Seas Labour

Vol. 1—No. 8.

March, 1931

ONE clear fact emerges from the economic convulsion through which the world is passing—namely, the world is accepting new standards of values. This is affecting nearly everything—and more particularly is it affecting primary products, such as foodstuffs and raw materials. Prac tically everything that is produced in the South Seas has moved to lower price levels, and is expected to remain there. There may be some recovery; but not in this generation are we likely to see again the prices of the 1923-28 era.

Primary producers everywhere can carry on only by adjusting their pro duction costs to the new levels at which they can sell their produce. All over the world, with blood and sweat and tears, the economic readjustment is going on. As soon as it is com plete, the world will return to normal trading—on new standards of values — and our troubles will be over. Men everywhere can hasten recovery by facing facts.

In the South Seas, two fundamental things are necessary a reappraise ment of capital values and a re arrangement of labour costs. In most of the Islands groups and territories, in the last decade, coconut plantations have been established, or bought, on a basis of value fixed by copra at £25-£30 per ton. At present, there is not one solitary indication that that price will return—the signs are all to the contrary. Plantation owners, sooner or later, must bring their capi tal values to accord with a copra price carrying a smaller margin of profit. It is a very big subject, which will be discussed at greater length in future issues of this Monthly.

The fact which must be faced promptly, and to which attention should now be given generally in the South Seas, is that labour must make a sacrifice, equally with capital.

Labour, throughout the world, is be ing made to face the issue. In coun tries where there has been much organisation of the industrial commun ity, there is much kicking and squeal ing, but the thing is inevitable—labour costs must be reduced, equally with capital costs. The adjustment is likely to be as difficult in the Pacific as it is among the white populations, because so much of the South Seas labour is under indenture, with the contracts controlled by the various administra tions. It may not be easy to make the Melanesian labourer understand the need for reduced pay—yet no more difficult, probably, than trying to pre sent the simple facts of economics to the noisy gentlemen of Sydney Trades Hall. In both cases, it has got to be

done. Labour will discover, eventu ally, that reduced pay does not mean a reduced standard of living—simply because all commodities are going to be cheaper.

Capital throughout the world has had a frightful “gruelling,” and it is not fair to ask capital in the South Seas, any more than elsewhere, to bear the whole of the punishment of the economic readjustment.