A study of changes in farm labour utilization and of farm population growth in Saskatchewan from 1896 to 1951
Powrie, Thomas L.
The object of this paper is to analyze labour utilization in agriculture in Saskatchewan during the period 1896 to 1951 and to examine the relation between population growth and the absorptive capacity for labour in agriculture. The term "labour utilization" refers to the actual disposition of the work force; it is the use to which the work force is being put at a given time and place. A description of the labour utilization of an economy, as here defined, is a statement of the number of workers employed in each of the various industries and occupations, and of the number of workers unemployed at a given time. 1 The term "absorptive capacity for Iabour'", as used in this paper, refers to the labour utilization by industry which would exist if an ideal disposition of the work force were established at a point in time. It assumes an equilibrium wage structure at full employment; that is, a wage structure consistent with the optimum allocation of labour. While labour utilization can be described precisely by means of available statistics, it is impossible to estimate absorptive capacity precisely. However, it is possible to determine whether absorptive capacity in a particular period has risen or fallen, since actual labour utilization tends to adjust to absorptive capacity. If employment of labour in a particular industry tends to rise continuously, it may safely be assumed that absorptive capacity in the industry has risen. Similarly, if employment of labour falls continuously, it is apparent that labour utilization exceeds absorptive capacity. If, allowing for non-monetary returns, wages are lower in a particular industry than in other industries in the economy by an amount greater than the cost of transferring labour from the industry, then labour will tend to leave that industry. That is, a wage differential unfavorable to the workers of a particular industry indicates that absorptive capacity is less than labour utilization in that industry. On the other hand, if wages in a particular industry are so high that new workers are attracted to the industry, absorptive capacity exceeds labour utilization in that industry. This paper attempts to explain the changing pattern of labour utilization in Saskatchewan over the period 1896 to 1951. Because employment of labour tends to be adjusted toward absorptive capacity, it is an important step toward a complete explanation of a change in labour utilization to recognize the direction of a change in absorptive capacity and to explain why the change occurred. This is the approach used in the present study. 1. Labour utilization is described in the present study by the use of census statistics. For a discussion of the gainfully occupied and the labour force concepts on which these statistics are based, see Appendix, p. xiv.