Читать книгу From Empire to Europe: The Decline and Revival of British Industry Since the Second World War - Geoffrey Owen - Страница 11

American and German competition affected different British industries in different ways. As far as the older industries are concerned, there was no obvious sign of entrepreneurial failure before 1914. The cotton textile industry, for example, continued to dominate the world market. Although export growth slowed down after 1870, this was due, not to a loss of competitiveness, but to the build-up of production behind tariff walls in countries which had previously imported from Britain. Similarly the shipbuilders faced no serious challenge from the US or Germany. Even in steel, where production in Britain fell behind that of Germany and the US soon after the turn of the century, this was largely for reasons outside the control of British steel-makers. Germany and the US were still in their catch-up phase, and steel consumption was rising more rapidly than in Britain. Both countries also protected their steel industries with tariffs. Thus British steel-makers were restricted from selling to the two most dynamic overseas markets, while their own home market was fully exposed to imports. In these circumstances a fall in Britain’s share of world steel production and exports was unavoidable.²⁸

The situation in the newer industries was more worrying. In electrical engineering, for example, none of the British entrepreneurs who came into the industry in the 1880s, following the invention of the incandescent lamp, built companies to match the size and technical strength of General Electric in the US, or Siemens and AEG in Germany. This has been blamed by historians on a variety of factors, including lack of support from the capital markets²⁹ and a distinctively British inability to create and manage large companies.³⁰ But a more important factor was a domestic environment which slowed down the growth of demand for electricity. In Britain, unlike the US and Germany, urbanisation was well advanced by the time electricity became available, and an extensive network of gas lighting was in place. The existence of this network was a disincentive to the rapid introduction of electricity, and it was reinforced by regulations designed to protect the interests of the gas-lighting suppliers.³¹

The other celebrated British failure was in the chemical industry, above all in dyestuffs, where German firms pioneered the new technique of synthetic organic chemistry and established a virtual world monopoly. But it was not a uniquely British failure. The American chemical industry was as far behind in this field as its British counterpart; up to the First World War the US market for synthetic dyestuffs was supplied mainly from Germany and Switzerland. There were, moreover, other branches of the industry where British entrepreneurs did well. One was soap-making, where William Lever built up what was to become one of Britain’s leading multinational companies. Another was rayon or artificial silk. The viscose process for making rayon yarn was patented by two British scientists, C. F. Cross and E. J. Bevan, in 1892, and brilliantly exploited by Courtaulds, the textile company. Courtaulds became the world’s largest rayon manufacturer, with a profitable subsidiary in the US.³²

At the level of individual industries, old and new, the British response to American and German competition between 1870 and 1914 was patchy but by no means disastrous.³³ World trade in manufactures had become a three-horse race, and the early leader could hardly have been expected to remain dominant on all fronts. Were there, nevertheless, institutional weaknesses, inherited from the first industrial revolution, which were holding industry in Britain back?

One obvious gap, especially compared with Germany, was in the field of technical education. In 1870 British universities were not well equipped to serve the new, science-based industries. Oxford and Cambridge had played no part in the industrial revolution, and had no interest in the world of industry. Nevertheless, although Britain started late in this field, it recovered well. New universities with a strongly technical bent were established in several provincial cities during the last years of the nineteenth century, and the Imperial College of Science and Technology was founded in London in 1908. There was also an expansion of part-time technical education below the university level. The British approach was more decentralised, less systematic and more market-led than in Germany, but by 1914 the gap between the two countries was narrowing. Sidney Pollard, the economic historian, has suggested that Germany’s investment in technical education and the role of the state in it ‘may not imply German superiority, simply a different tradition and a different place in the sequence of world industrialisation’.³⁴

Some historians believe that the creation of the universal bank gave German entrepreneurs a competitive advantage because it provided access to long-term capital on terms which were not available in Britain.³⁵ British commercial banks, even after the mergers that took place towards the end of the century, generally steered clear of long-term lending to industry, while the merchant banks in the City – Barings, Rothschilds and the rest – were preoccupied with raising capital for foreign borrowers. There were flaws in the financial system during this period, but financial markets were sufficiently well-developed to ensure that few creditworthy entrepreneurs were starved of finance. There is no clear evidence that the outflow of capital to support railway construction and other infrastructure projects overseas diverted funds from investment in domestic industry.³⁶ The German universal bank was a response to a particular set of circumstances – a late-developing country undergoing a very rapid process of industrialisation – that did not exist in Britain.

As for the impact of trade unions on industrial performance, labour relations in Britain went through a stormy period around the turn of the century, and again in the years immediately preceding the First World War. This was due partly to a change in the character of trade-unionism, arising from the emergence of more militant ‘general’ unions which represented semi-skilled and unskilled workers. Labour relations became more adversarial, and in industries such as engineering, where craft unions were strong, the number of disputes over working practices and demarcation increased. But the employers generally came out on the winning side in these disputes, and the labour relations system was probably not a significant brake on efficiency and technical progress in manufacturing before 1914.

The late Victorian and Edwardian entrepreneur has been criticised by some historians for his reluctance to break away from craft control – the practice of delegating to skilled workers part of the responsibility for the organisation of work. The argument is that this practice delayed the introduction of ‘Taylorist’ techniques, which called for tighter supervision of shop floor labour.³⁷ But for most British employers craft control was not a competitive disadvantage in the conditions which they faced before the First World War. In shipbuilding, for example, where craft control was solidly entrenched, productivity in Britain was higher than in the US and Germany, and there was no reason to abandon a well-tried production system which was working satisfactorily. This point is also relevant to Alfred Chandler’s strictures about personal capitalism. The main reason for the creation of giant companies in the US towards the end of the nineteenth century was the nature of the domestic market. Firms which were manufacturing on a large scale needed to take direct control over the procurement of raw materials and the distribution of finished products. In Britain, with a smaller home market and more highly developed networks of merchants and other intermediaries, there was less need for manufacturers to integrate backward into raw material purchasing or forward into marketing and distribution.³⁸ Lancashire cotton was the classic case of a successful industry which was both horizontally and vertically disintegrated, with most firms specialising in one part of the production chain.

The comparison with Germany is less clear-cut. In industries where German companies were bigger than their British counterparts, this, too, was mainly due to the character and timing of German industrialisation. The iron-masters of the Ruhr were building a new industry from scratch in an undeveloped region. They needed to do more things for themselves than was necessary in Britain, and to integrate more operations on the same site. Some German companies, of which Thyssen and Siemens are examples, did adopt organisation methods similar to those of the big American corporations.³⁹ But many of Germany’s industries, such as mechanical engineering, were as fragmented, and as dominated by family-owned concerns, as in Britain.