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Chapter III.

Diminution of Foreign Trade in 1884—its Effects on the Special Industries Connected with Foreign Trade.

2. We have now to consider the effect of diminished Imports and Exports on those special industries which are connected with, or dependent upon, foreign trade. A moment's reflection makes it plain that the shipping interest must necessarily be the chief and the earliest sufferers. Here are, in the course of a few months, some 43 millions worth of merchandise less to carry to and fro between the United Kingdom and the rest of the world; 21½ millions of Imports less to bring in, and 21½ millions of Exports less to take out. This is an enormous quantity, and must make a big hole in our carrying trade. Let us try to frame a rough and approximate estimate of the number of shiploads which 43 millions worth of merchandise may represent, and of the consequent diminution it must effect in the demand for mercantile shipping. For this purpose we will take as a criterion the easily ascertainable diminution in bulk of our cereal Imports in 1884, and from this calculate the number of cargoes less of grain alone, that must have been brought to the United Kingdom during that year, than the annual average of the preceding four years. In a foot-note ^* page 14 will be found the data and the calculations from which we collect that, of cereals alone, we had, in 1884, imported into the United Kingdom 1,315 shiploads less than the average of previous years. Now, these 1,315 shiploads only represent £15,700,000 out of the total £43,000,000 short imported and exported in 1884. If we take the remaining £27,300,000 of miscellaneous goods, to represent a proportionate number of shiploads, we shall arrive at an additional number of 2,286, making, with the 1,315, a total of 3,601 shiploads less carried during the year 1884 than during previous years.

Something, however, will have to be deducted from that total as affecting British shipowners, because foreign ships have some share (though but a small one) in the ocean-carrying trade, and some share, proportionately small, of the depression would fall upon them.

It is evident that, after making all reasonable allowances, our shipowners have had from 2,500 to 3,000 fewer cargoes to carry during 1884 than the average of previous years. To what extent so sudden a collapse must have injuriously affected shipowners may be vaguely imagined, but can never be accurately assessed. A number of their vessels must have remained totally unemployed, and have been laid up in expensive idleness. But this disaster forms only a part of the losses which accrued to the shipowners. A still greater loss to them resulted from the very reduced rates of freight to which they were compelled to submit. The demand for ships having largely fallen off, the keenest competition ensued among owners to secure what freights there might be offering. One would bid against the other until the rates were cut down to the lowest endurable point. Owners are naturally very reluctant to incur the great loss and inconvenience of laying up their ships, and keeping them like unemployed horses in a stable, that "eat their heads off." In preference, they in many instances accepted unremunerative and even losing freights. How much less money was actually received for freight by shipowners in 1884, as compared with 1883, who can tell? page 15 But it is certain that, what with some of their ships earning no money at all, and the rest barely paying their expenses, their cash receipts last year must have shown a lamentable falling off from those of previous years. We think that it has now been made quite clear why, and in what way, shipowners were heavy sufferers by the suddenly diminished foreign trade of 1884.

Among other cognate interests which also suffered extensively from the same causes, the ship-builders stand prominently forward. For several years previous to 1884, our shipbuilding yards, in England and Scotland, from the Thames to the Clyde, had enjoyed unprecedented prosperity. They could hardly supply ships fast enough to meet the demand, and good profits and good wages made both masters and men happy. But when, from causes which we have already explained, early in 1884, first Imports and then Exports suffered a great decline, the demand for ocean conveyance declined in similar proportion. Ships became redundant, orders for building new ones ceased to flow in, and the yards, which had lately presented such a busy scene of industry, became comparatively silent and desolate. Heavy losses fell on the master-builders which, however, their solid wealth from previous accumulations enabled them to bear, while the working shipwrights, the wage receivers, thrown out of employment by no fault of their own, underwent severe distress during the gradual displacement of their labour into other channels of employment.

As a natural consequence, the diminished construction of ships (in which the consumption of iron enters so largely) occasioned a proportionate falling off in the demand for that metal, so that (other concurrent causes assisting) the wave of depression extended to the iron trade, and then spread to the closely connected coal producing industries and others which they influence more or less directly.

Moreover, it would necessarily follow from there being between 2,500 and 3,000 fewer cargoes to load and unload at our page 16 chief ports, London, Liverpool, Glasgow, &c., that there would be less demand for persons living by that kind of labour, so that a number of dock-labourers of all sorts would be thrown out of work, and. would have to endure much privation till reabsorbed into other openings for their labour.

We have now enumerated, not indeed all, but the chief industries which might, a priori, have been expected to sutler by the diminished Imports and Exports, three-fourths of which diminution arose directly, and much of the remainder indirectly, from the increased produce of our harvest in 1884. Let us now see how these forecasts tally with the actual facts as they occurred. On examination we find that the industries which really did most suffer during the "recent and present "depression are precisely those which we have enumerated above. The loudest and most justifiable complaints of distress have proceeded from the ship-owning interest, the ship builders and their artisans, the iron and coal industries, the dock-labourers, and a few other classes more or less dependent on foreign trade. From the great manufacturing districts there came but few complaints. The agricultural classes were better off than usual. The retail traders throughout the country, a large and sensitive class, were in a flourishing state; the miscellaneous labour-sellers, with the few exceptions to which we have referred, were well employed and well paid; and the general prosperity of the country was unimpaired. How it came to pass that so large a diminution, within so small a space of time, as 43 millions in our foreign trade, should have produced so little derangement in our internal economy as it did, will form the subject of our next chapter.