"During this whole period, the competitors of the company never
succeeded in averaging over half of this production per lathe, although
they knew and even saw what was being done at Midvale. They, however,
did not allow their men to earn from over $2.00 to $2.50 per day, and so
never even approached the maximum output.

"The following table will show the economy of paying high wages under
the differential rate in doing the above job:

"COST OF PRODUCTION PER LATHE PER DAY

ORDINARY SYSTEM OF PIECE WORK--Man's wages $2.50 Machine cost 3.37 Total
cost per day 5.87 5 pieces produced; Cost per piece $1.17

DIFFERENTIAL RATE SYSTEM--Man's wages $3.50 Machine cost 3.37 Total cost
per day 6.87 10 pieces produced; Cost per piece $0.69

"The above result was mostly though not entirely due to the
differential rate. The superior system of managing all of the small
details of the shop counted for considerable."

The exceedingly dull times that began in July, 1893, and were
accompanied by a great fall in prices, rendered it necessary to lower
the wages of machinists throughout the country. The wages of the men in
A. the Midvale Steel Works were reduced at this time, and the change was
accepted by them as fair and just.

Throughout the works, however, the principle of the differential rate
was maintained, and was, and is still, fully appreciated by both the
management and men. Through some error at the time of the general