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22 MARINE REVIEW. [May 22 CENSUS RETURNS REGARDING SHIP BUILDING INDUSTRY. A bulletin dealing with the ship building industry in the United States has just been issued by the census bureau. This bulletin was very briefly referred to in the last issue of the Review. Liberal extracts are now made from it. The reports of the twelfth census, year 1900, show a capital of $77,362,701 invested in the 1,116 establishments throughout the United States not including establishments owned by the government. This sum represents the value of land, buildings, machinery, tools, and implements, and the live capital utilized, but does not include the capital stock of any of the corporations. The value of the products is returned at $74,578,158, to produce which involved an outlay of $2,008,537 for salaries of officials, clerks, etc.; $24,839,163 for wages; $3,685,661 for miscellaneous expenses, including rent, taxes, etc.; and $33,486,772 for materials used, mill supplies, freight and fuel. It is not to be assumed, however, that the difference between the aggregate of these sums and the value of the products is, in any sense, indicative of the profits in the manufacture of the products dur- ing the census year. The census schedule takes no cognizance of the cost of selling, or of interest on capital invested, or of the mercantile losses incurred in the business, or of depreciation in plant. Two tables that appear on the opposite page summarize fully the ship building industry of the country. The first table contains statistics of the entire industry, exclusive of establishments owned by the government, as returned at the censuses of 1850 to 1900, inclusive, with the percentage of increase for each decade. The second table shows the industry in 1900 divided as to wood, iron and steel construction, government establishments and establishments with a product of less than $500. 4 It is shown by these tables that the number of establishments engaged in the building and repairing of vessels, boats, etc., increased from 953 in 1850 to 1,116 in 1900, or 17.1 per cent., while the capital invested increased from $5,373,139 to $77,362,701, or 1,339.8 per cent. This is an increase in the average capital per establishment invested in the industry, fromr $5,638 in 1850 to $69,321 in 1900, or 1,129.5 per cent. During the same period the average number of wage-earners increased from 12,976 to 46,781, or 260.5 per cent. The total value of constructions and repairs increased from $16,937,525 to $74,578,158, or 340.38 per cent. Of the latter sum a large part represents work done for the navy and war departments. It was found impracticable to secure any statement from these departments covering the census year ending May 31; but it appears that during the year ending June 30, 1900, the sum of $8,554,862 was disbursed in the navy department to private ship building establishments for construction and repairs, and the sum of $5,493,556 in the war department, the total being $14,048,488, or 18.8 per cent. of the total value of products reported by private ship yards for the census year. Of the amount disbursed in the war department, $1,291,581 was for "fitting up chartered transports," the remainder being expended 'for refitting and repairs of vessels owned by the war department." It is also shown by the tables that the capital in- vested in ship building in 1850 and 1860 was less than $6,000,000, a sum insufficient to replace any one of several existing iron and steel establish- ments. The value of the products in 1850 was more than three times greater than the capital invested, and in 1860 was more than twice as great. In 1900, for the first time in the census history of the industry, the value of products was less than the capital invested. The ratio of capital to product has steadily increased from 1850 to the present time. In 1850 the wages paid to labor exceeded the capital, but in 1900 was less than one- third the amount invested. But as against all these proofs of growth of the industry there is the sad commentary that our progress is confined almost entirely to ships for domestic service; that we have a very small share of the world's carrying trade. This feature of the situation is very ably set forth in the bulletin by Alexander R. Smith, special census agent, who writes as follows: GROWTH OF SHIP BUILDING CONFINED TO DOMESTIC TRADE, "The growth of the ship building industry in the United States during the past ten years, as shown by the census reports, exceeds that of any: preceding decade, and the tonnage constructed during the census year ending May 31, 1900, was greater than during any preceding year in the history of the United States, with the possible exceptions of 1854 and 1855. Although in other countries iron and steel long ago largely superseded wood as the chief material used in the construction of ships, the census statistics show that it was not until the last decade that metal ship build- ing attained proportions greater than wooden in private ship yards of the United States. This substitution of iron and steel for wood has wrought a revolution in the ship building industry in the United States. The zenith of American ship building, judged by the tonnage annually added to the merchant marine, was reached during the decade between 1850 and 1860. At that time the superiority of ships built in the United States for endur- ance, speed and safety was conceded. It was the era of the American clipper. This class of wooden sailing ships commanded higher freight rates, even in Liverpool and London, than British ships, and insurance rates on American vessels and their cargoes were lower than on foreign ships. These advantages placed the United States in the very front rank in international trade-carrying competition. This prestige had been in- creasing ever since the successes achieved by the United States in the carrying trade during the Napoleonic wars. The easy convertibility of the wooden vessels of that time into ships of war gave a distinct naval strength and solidity to the nation. The passing of wooden ship building, therefore, as the dominent branch of the ship building industry in the United States, has an historical significance. "One remarkable feature of the growth of the industry during the past decade is the fact that the product of merchant vessels has been' so largely absorbed and employed in the domestic commerce of the country. Up to the time of the civil war the tonnage of vessels constructed in American ship yards for the foreign trade compared favorably with that for the domestic trade; and, indeed, the progress and prosperity of the industry rested largely upon the demands for vessels for foreign com- merce. This is no longer true. Comparatively few vessels for foreign | trade are now built in American ship yards, But in the meantime 'the | jenormous growth of internal commerce, together with the opportunities | afforded by the extensive coast line of the United States, the great lakes, and the navigable rivers, which in many cases have been so deepened, at an expense reaching into hundreds of millions of dollars, as to accommo- date the passage of the largest vessels, has greatly developed the demand for vessels in the domestic trade. This has not only kept alive our ship- building industry, but constitutes also, in large part, the foundation upon which it has expanded. Another important element in the growth of the industry has been the demand of the government for a new navy con- structed in home ship yards. c : "During the last four decades, therefore, the stability of the industry in the United States has rested almost wholly upon the domestic or coast- wise trade, the vessels constructed for foreign trade representing but a small proportion of the entire output of the ship yards. Whether or not this is due to the fact that the domestic water-borne trade of the United States has by law been restricted to vessels built in the United States, need not here be discussed. These restrictions have existed since the founda- tion of the government, at first by statutory discriminations in favor of home vessels that practically excluded foreign tonnage, and, ever since the early part of the nineteenth century, by statutory prohibition. Under such restrictions ship building for the internal commerce of the United States has grown and prospered. On the other hand, in the foreign trade, to which foreign vessels for many years have been admitted upon terms of perfect equality with those of the United States, the foreign tonnage has maintained an almost constant increase, while the domestic tonnage has steadily diminished. "The completeness of the decline of American shipping in the foreign trade may be briefly illustrated by quotations from the statistical history: of the growth of the foreign commerce of the United States, showing the share in its carriage taken by American ships in the earlier years .com- pared with the present time. In 1826 American vessels carried 92.5 per cent. of the foreign commerce of the United States, the value of which was $150,331,636, while in 1900 they carried 9.3 per cent., the value of which was $195,083,155, an increase in value of only 29.5 per cent. in seventy-four years. In 1826 foreign vessels carried 7.5 per cent. of our foreign com- merce, valued at $12,238,163, while in 1900 they carried 90.7 per cent., valued at $1,894,445,461, an increase of 15,379.8 per cent. in seventy-four years. "While the census returns do not indicate the particular trade in which the vessels built are to engage, other official records are at hand which in part supply the information. For instance, no vessel is permitted to en- gage in foreign trade unless provided with a register, a document issued by the government through its custom houses. Hence the American ship- ping under register accurately shows the total tonnage of the United States engaged in the foreign trade. The returns for the twelfth census show that the vessels of all kinds--sail and steam, steel and wood, includ- ing barges and canal boats--constructed in the ship yards of the- United States in 1900 numbered 2,087, with a gross tonnage of 687,681 tons. The report of the commissioner of navigation for 1900 shows that eighty-eight American-built vessels, with a total of 29,069 gross tons, were registered for the foreign trade. This tonnage constitutes only 4.2 per cent. of the total product turned out by American ship yards in 1900; hardly equiva- lent to half a month's construction. Reports of the commissioner of navi- gation show further that during the ten years ending with 1900, 206,771 tons of vessels built in the United States were registered for the foreign trade, a total that is equal to only 30.1 per cent. of the tonnage constructed in ship yards of the United States for all purposes in the year 1900; that is to say, in less than four months of 1900 as much tonnage was built in American ship yards for all trades as was built in those ship yards for foreign trade during the entire ten years ending with 1900. ABOUT 5,000,000 TONS IN SHIPS WOULD BE REQUIRED FOR OUR FOREIGN TRADE. "Although the actual tonnage of different vessels, foreign and domestic, engaged in the foreign trade of the United States is not pre- cisely known, estimates have been made by different commissioners of navigation which may serve as a basis for comparison. In the report of the commissioner of navigation for 1900 the tonnage necessary for the foreign carrying trade in 1899 is estimated at 3,571,284 gross tons of steam and 1,000,000 tons of sail, a total of 4,571,284 tons. This is the lowest official estimate that has been made. The commissioner of navigation stated in 1890 that 6,500,000 tons would be required to carry 83 per cent. of the foreign commerce of the United States at that time. That would make the tonnage required for carrying the entire foreign commerce of the United States 7,831,325 tons. Since that time the value of our foreign commerce has increased 36 per cent. In view of these expert official esti- mates, it would be conservative to state that fully 5,000,000 tons of ship- ping are now required for the carriage of the entire foreign commerce. Toward supplying that need home ship yards, as we have seen, contributed only 29,069 tons during the census year of 1900, and only 206,771 tons during the entire ten years ending with 1900. At the rate of construction in 1900 172 years would elapse before enough tonnage would be built for the present needs of our foreign trade. The average life of a ship is com- monly computed at ten years, taking into account losses, accidents, and deterioration. But allowing twenty years as the average life of a modern steel steamship, at the present rate of construction for foreign trade over eight years would elapse before enough ships would be constructed to provide for the average losses of one year. In Great Britain, in 1899, steel steamships to the number of 567 were constructed, the tonnage of which aggregated 1,341,425, while in the United States 123 steel steam vessels ag- gregating 237,379 gross tons, were constructed for all kinds of trade, inland, coastwise and foreign. As a matter of fact only one steel steam vessel, of 1,771 tons, was built in the United States during 1900 for the foreign trade. On the great lakes alone vessels aggregating 111,241 gross tons were built in 1900, or 16.2 per cent. of the total tonnage built during that year in the United States, while the tonnage built under register, as pre- viously stated, constituted but 4.2 per cent. of the total tonnage, or 26.1 per cent. of that constructed for the traffic of the great lakes. In number of tons, the merchandise moved annually upon the great lakes approxi- mates very closely to the merchandise annually imported into and ex- ported from the United States, but the distance it is carried is very much less. For this reason the commerce of the great lakes, can be carried by use of a tonnage approximately one-third as large as is necessary for the carriage of our foreign commerce. And yet, notwithstanding the smaller