See footnotes at end of table, p. 58.

(12)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

(9)

(10)

(11)

46, 116

These figures can be fully understood only if we realize that the minimum wage in Puerto Rico has a tendency to be the prevailing wage. This is not literally true in all cases. Here are some examples of a smaller relative increase in payrolls than the relative increase in the minimum wage-a situation which proves that there is a wage structure over and above the minimum:

Mattress, quilts, and pillows, August 23, 1954-increase in minimum, 50.1 percent; increase in payrolls, 13.6 percent;

Shoe manufacturing and allied products, January 4, 1954increase in minimums, 14.2 percent; in payrolls, 3.1 percent; Rubber, straw, hair, and related products, October 13, 1952increase in minimum, 50 percent; in payrolls, 13.0 percent. Similar examples could be given for railroads, railway express, and property motor transport (May 4, 1953); construction, business service, etc. (August 11, 1952); hooked rugs (July 21, 1952); chemicals, petroleum, and related products (July 14, 1952); leather, leather goods, etc. (September 14, 1953); cement (July 14, 1953); corsets, brassieres, etc. (November 8, 1954).

These are significant instances but in no way do they change the basic situation, which may be formulated as follows: minimum wages tend to be prevailing wages. This tendency is strongest in the lowest paid industries and becomes less pronounced in the higher paid industries.

Under such circumstances a change in the minimum wage has a significant influence on the whole wage structure. This factor should be taken into consideration by the subcommittee in proposing graduated increases.

However, there were other factors which should be considered in an extremely complex situation which is due to the fact that Puerto Rico, while being at a different stage of economic development from the mainland, is in an intimate competitive relationship with various mainland industries, particularly in the needle trades.

As table 25 shows, Puerto Rico has made considerable strides in raising its wage level. From an average hourly wage of 44.3 cents in manufacturing in 1950, wages increased to an average of 55.4 cents in April 1954, respectively 50.2 cents in October 1954. (April is the seasonally high month, October the low month.) This is an increase of 5.9 respectively 11.1 cents or an average increase of 8.5 centsand of 13.3 percent respectively 25.3 percent or an average of 19.3 percent. In individual industries the absolute and relative increases were considerably higher, yet the large number of low-paid needle workers who did not get major increases until June 1955 kept the overall manufacturing average low.

These figures compare with a relative increase of over 30 percent in average hourly earnings in manufacturing (January 1950-October 1954) and an absolute increase of 41 cents on the mainland. While the relative increase in average hourly earnings amounted to about twothirds of that in the mainland, the absolute differential between the mainland and Puerto Rico widened from 98 cents in January 1950 to $1.31 in October 1954.

These figures illustrate why an across-the-board increase of 25 cents equal to the increase on the mainland is necessary, fully realizing that it would be impossible for Puerto Rico to absorb such an increase immediately.