5% is added against the job for errors or excessive charges. The second and most important item of factory expense is labor. By labor we mean the wages paid to the workmen and foremen directly engaged upon the manufacture of the commodity. A great many difficulties arise in the apportionment of labor, although in the aggregate it is easy to determine. There are two elements involved in keeping labor cost. The first is the time element, and, second, the labor skill. The time element must be taken as a basis, while the variations of expense appear in the gradations of skill required in the different departments of the factory. It is very difficult to measure by any standard which is accurate and just, and it is not easy to ascertain the quantity of labor used on a given commodity. If the laborers were equal in skill, some just standard could be devised. Even if the factory management desires to develop and reward skill, it is often made difficult because labor organizations are opposed to too much individualism in compensation. The management seeks efficiency, and should form its schedule of wages so that a constant stimulus for larger effort on the part of labor will be constantly present. Efficiency is measured in terms of the quantity and quality of the output. As a result of these inequalities, the employer and laborer are struggling over the wage prob BUSINESS ORGANIZATION Lem in all lines of industry a struggle which gives to the subject a large public interest. The essentials of the controversy are well illustrated in manufacturing. The manufacturer desires naturally to secure the largest labor efficiency with the least expenditure of time and wages....

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