Business: Schwab on Employes

At the 48th Annual meeting of the American Society of Mechanical Engineers at Manhattan last week, Charles Michael Schwab ended his year as the society’s president with a valedictory that included his present philosophy of dealing with employes. Alex Dow, president of the Detroit Edison Co., succeeded him as president.

Mr. Schwab’s speech was significant because it phrased authoritatively the attitude of scientific industrial managers toward their employes. Said he: “What are these reasonable wants of employes, which they have a right to see satisfied as far as conditions of industry permit? I believe they include the payment of fair wages for efficient services; steady, uninterrupted employment; safeguarding of their lives and health; good physical working conditions; provision for them to lay up savings and to become partners in the business through stock ownership; and finally, some guarantee of financial independence in old age. , . .

“Successful industrial management in the future is going to depend more and more upon management of men rather than upon the organization of machines and other problems which are ordinarily considered in the sphere of practical engineering. For the most part and generally speaking the engineering profession may be said to have solved or laid the groundwork of solution for the essential problems of the engineer in his technical field. Experience shows, however, that industry’s most important task in this day of large-scale production is management of men on a human basis.”

For mechanical engineers of middle age, Mr. Schwab’s doctrines had a further significance. Those men could recall the bloody Homestead Strike of 1892 when Mr. Schwab, then one of the late Andrew Carnegie’s “young men” and a superintendent of the Carnegie Steel Co., was obliged to proceed violently against the steel employes. The company had ordered wages reduced. The workmen refused to work for less money and took possession of the steel ‘works. The company hired Pinkerton detectives who, armed with Winchester rifles, came up the Ohio River on two barges. The workmen threw up barricades of steel billets and railroad ties, mounted a cannon on each side of the river and fired upon the detectives. The detectives returned the fire. The workmen poured oil on the barges and on the river, and prepared to set the oil afire. The detectives surrendered. Seven men were killed and 20 to 30 wounded. The state government sent troops and put the Homestead Steel Works district under martial law. That broke the strike, but not before eleven strikers and spectators were killed and many a trooper and civilian was stoned or clubbed. Bitter and bloody as the strike was, it brought wisdom to all steel employers and eventual benefits to the employes. In the battle Mr. Schwab had been a hard-bitten fighter for the Carnegie Steel Co.; in the peace his natural bonhomie won the goodwill of returned employes.