On this day in economic and business history…
One of the last major industries in the United States finally made the shift to an eight-hour day on Aug. 13, 1923. United States Steel Corporation (NYSE:X), the world’s largest steelmaker, led the charge, and its employees couldn’t have been happier, according to a contemporary report from the Chicago Daily Tribune:
It was a day of cheer yesterday for thousands of men in the far flung rolling mills of the United States Steel Corporation (NYSE:X), for the twelve hour day began to pass into history.
The roaring of the mighty blast furnaces was music to these toil weary men. Eight hours and hundreds were “off the job,” exulting like kids on their first day out of school. The twelve hour day is dead; long live the eight hour day! That was their sentiment and they had only grins for the obsequies of the former. … [At] every place where there are subsidiaries of the great steel corporation, a start was made on the beginning of the end of the twelve-hour day.
The shift to eight-hour workdays in the manufacturing industries had begun nine years earlier with Ford Motor Company (NYSE:F)‘s legendary shift to a $5, eight-hour day (for six days a week). The success of Ford Motor Company (NYSE:F)’s initiative gradually convinced many industrialists across the nation that a broad base of well-paid, well-rested workers was preferable to the constant toil of weary men, who were more liable to suffer dangerous or deadly accidents on the job. The move was also spurred on by the memory of former President Warren G. Harding, who had died of a presumed heart failure less than two weeks earlier and who had thrown his support behind more tolerable labor standards during his brief tenure.
Many smaller steelmakers jumped on the eight-hour bandwagon, either out of fear that they would lose better workmen to United States Steel Corporation (NYSE:X) or out of genuine concern for the health of their workforce. It was estimated that United States Steel Corporation (NYSE:X)’s vast mills would need to hire thousands of new workmen to maintain production while employing workers for shorter days. Its massive Gary, Ind., plant — which remains the largest integrated mill in North America and which was responsible for the creation of Gary itself — would need at least 2,000 new workers, and the transition process would not be completed for several months.
Ford Motor Company (NYSE:F) continued to push for higher workplace labor standards during this period as well. Three years later, the automaker switched its entire manufacturing workforce to a 40-hour workweek of five eight-hour days. It should come as no surprise that the Roaring ’20s, which produced the greatest sustained bull market in the history of the Dow Jones Industrial Average (Dow Jones Indices:.DJI) (gains reached nearly 500% compared to a 400% rise during the dot-com era) also experienced incredible productivity growth in the manufacturing industries. This wasn’t exclusively the result of better labor conditions, but the impact of that change can’t be ignored.