Of Wages And Profit In The Different Employments Of Labour And Stock

The whole of the advantages and disadvantages of the different

employments of labour and stock, must, in the same neighbourhood, be

either perfectly equal, or continually tending to equality. If, in the

same neighbourhood, there was any employment evidently either more or

less advantageous than the rest, so many people would crowd into it

in the one case, and so many would desert it in the other, that its

advantages wo
ld soon return to the level of other employments. This, at

least, would be the case in a society where things were left to follow

their natural course, where there was perfect liberty, and where every

man was perfectly free both to choose what occupation he thought proper,

and to change it as often as he thought proper. Every man's

interest would prompt him to seek the advantageous, and to shun the

disadvantageous employment.

Pecuniary wages and profit, indeed, are everywhere in Europe extremely

different, according to the different employments of labour and stock.

But this difference arises, partly from certain circumstances in

the employments themselves, which, either really, or at least in the

imagination of men, make up for a small pecuniary gain in some, and

counterbalance a great one in others, and partly from the policy of

Europe, which nowhere leaves things at perfect liberty.

The particular consideration of those circumstances, and of that policy,

will divide this Chapter into two parts.

PART I. Inequalities arising from the nature of the employments


The five following are the principal circumstances which, so far as I

have been able to observe, make up for a small pecuniary gain in some

employments, and counterbalance a great one in others. First, the

agreeableness or disagreeableness of the employments themselves;

secondly, the easiness and cheapness, or the difficulty and expense of

learning them; thirdly, the constancy or inconstancy of employment in

them; fourthly, the small or great trust which must be reposed in those

who exercise them; and, fifthly, the probability or improbability of

success in them.

First, the wages of labour vary with the ease or hardship, the

cleanliness or dirtiness, the honourableness or dishonourableness, of

the employment. Thus in most places, take the year round, a journeyman

tailor earns less than a journeyman weaver. His work is much easier. A

journeyman weaver earns less than a journeyman smith. His work is not

always easier, but it is much cleanlier. A journeyman blacksmith, though

an artificer, seldom earns so much in twelve hours, as a collier, who is

only a labourer, does in eight. His work is not quite so dirty, is less

dangerous, and is carried on in day-light, and above ground. Honour

makes a great part of the reward of all honourable professions. In

point of pecuniary gain, all things considered, they are generally

under-recompensed, as I shall endeavour to shew by and by. Disgrace has

the contrary effect. The trade of a butcher is a brutal and an odious

business; but it is in most places more profitable than the greater part

of common trades. The most detestable of all employments, that of public

executioner, is, in proportion to the quantity of work done, better paid

than any common trade whatever.

Hunting and fishing, the most important employments of mankind in

the rude state of society, become, in its advanced state, their most

agreeable amusements, and they pursue for pleasure what they once

followed from necessity. In the advanced state of society, therefore,

they are all very poor people who follow as a trade, what other

people pursue as a pastime. Fishermen have been so since the time of

Theocritus. {See Idyllium xxi.}. A poacher is everywhere a very poor man

in Great Britain. In countries where the rigour of the law suffers no

poachers, the licensed hunter is not in a much better condition. The

natural taste for those employments makes more people follow them,

than can live comfortably by them; and the produce of their labour, in

proportion to its quantity, comes always too cheap to market, to afford

any thing but the most scanty subsistence to the labourers.

Disagreeableness and disgrace affect the profits of stock in the same

manner as the wages of labour. The keeper of an inn or tavern, who is

never master of his own house, and who is exposed to the brutality of

every drunkard, exercises neither a very agreeable nor a very creditable

business. But there is scarce any common trade in which a small stock

yields so great a profit.

Secondly, the wages of labour vary with the easiness and cheapness, or

the difficulty and expense, of learning the business.

When any expensive machine is erected, the extraordinary work to be

performed by it before it is worn out, it must be expected, will replace

the capital laid out upon it, with at least the ordinary profits. A

man educated at the expense of much labour and time to any of those

employments which require extraordinary dexterity and skill, may be

compared to one of those expensive machines. The work which he learns to

perform, it must be expected, over and above the usual wages of common

labour, will replace to him the whole expense of his education, with at

least the ordinary profits of an equally valuable capital. It must do

this too in a reasonable time, regard being had to the very uncertain

duration of human life, in the same manner as to the more certain

duration of the machine.

The difference between the wages of skilled labour and those of common

labour, is founded upon this principle.

The policy of Europe considers the labour of all mechanics, artificers,

and manufacturers, as skilled labour; and that of all country labourers

us common labour. It seems to suppose that of the former to be of a more

nice and delicate nature than that of the latter. It is so perhaps in

some cases; but in the greater part it is quite otherwise, as I shall

endeavour to shew by and by. The laws and customs of Europe, therefore,

in order to qualify any person for exercising the one species of labour,

impose the necessity of an apprenticeship, though with different degrees

of rigour in different places. They leave the other free and open to

every body. During the continuance of the apprenticeship, the whole

labour of the apprentice belongs to his master. In the meantime he must,

in many cases, be maintained by his parents or relations, and, in almost

all cases, must be clothed by them. Some money, too, is commonly given

to the master for teaching him his trade. They who cannot give money,

give time, or become bound for more than the usual number of years; a

consideration which, though it is not always advantageous to the

master, on account of the usual idleness of apprentices, is always

disadvantageous to the apprentice. In country labour, on the contrary,

the labourer, while he is employed about the easier, learns the more

difficult parts of his business, and his own labour maintains him

through all the different stages of his employment. It is reasonable,

therefore, that in Europe the wages of mechanics, artificers, and

manufacturers, should be somewhat higher than those of common labourers.

They are so accordingly, and their superior gains make them, in most

places, be considered as a superior rank of people. This superiority,

however, is generally very small: the daily or weekly earnings of

journeymen in the more common sorts of manufactures, such as those of

plain linen and woollen cloth, computed at an average, are, in most

places, very little more than the day-wages of common labourers. Their

employment, indeed, is more steady and uniform, and the superiority of

their earnings, taking the whole year together, may be somewhat greater.

It seems evidently, however, to be no greater than what is sufficient

to compensate the superior expense of their education. Education in the

ingenious arts, and in the liberal professions, is still more tedious

and expensive. The pecuniary recompence, therefore, of painters and

sculptors, of lawyers and physicians, ought to be much more liberal; and

it is so accordingly.

The profits of stock seem to be very little affected by the easiness

or difficulty of learning the trade in which it is employed. All the

different ways in which stock is commonly employed in great towns seem,

in reality, to be almost equally easy and equally difficult to learn.

One branch, either of foreign or domestic trade, cannot well be a much

more intricate business than another.

Thirdly, the wages of labour in different occupations vary with the

constancy or inconstancy of employment.

Employment is much more constant in some trades than in others. In

the greater part of manufactures, a journeyman maybe pretty sure of

employment almost every day in the year that he is able to work. A mason

or bricklayer, on the contrary, can work neither in hard frost nor in

foul weather, and his employment at all other times depends upon the

occasional calls of his customers. He is liable, in consequence, to be

frequently without any. What he earns, therefore, while he is employed,

must not only maintain him while he is idle, but make him some

compensation for those anxious and desponding moments which the thought

of so precarious a situation must sometimes occasion. Where the computed

earnings of the greater part of manufacturers, accordingly, are nearly

upon a level with the day-wages of common labourers, those of masons

and bricklayers are generally from one-half more to double those wages.

Where common labourers earn four or five shillings a-week, masons and

bricklayers frequently earn seven and eight; where the former earn six,

the latter often earn nine and ten; and where the former earn nine and

ten, as in London, the latter commonly earn fifteen and eighteen. No

species of skilled labour, however, seems more easy to learn than that

of masons and bricklayers. Chairmen in London, during the summer season,

are said sometimes to be employed as bricklayers. The high wages of

those workmen, therefore, are not so much the recompence of their skill,

as the compensation for the inconstancy of their employment.

A house-carpenter seems to exercise rather a nicer and a more ingenious

trade than a mason. In most places, however, for it is not universally

so, his day-wages are somewhat lower. His employment, though it depends

much, does not depend so entirely upon the occasional calls of his

customers; and it is not liable to be interrupted by the weather.

When the trades which generally afford constant employment, happen in

a particular place not to do so, the wages of the workmen always rise a

good deal above their ordinary proportion to those of common labour. In

London, almost all journeymen artificers are liable to be called upon

and dismissed by their masters from day to day, and from week to week,

in the same manner as day-labourers in other places. The lowest order

of artificers, journeymen tailors, accordingly, earn their half-a-crown

a-day, though eighteen pence may be reckoned the wages of common labour.

In small towns and country villages, the wages of journeymen tailors

frequently scarce equal those of common labour; but in London they are

often many weeks without employment, particularly during the summer.

When the inconstancy of employment is combined with the hardship,

disagreeableness, and dirtiness of the work, it sometimes raises

the wages of the most common labour above those of the most skilful

artificers. A collier working by the piece is supposed, at Newcastle, to

earn commonly about double, and, in many parts of Scotland, about three

times, the wages of common labour. His high wages arise altogether

from the hardship, disagreeableness, and dirtiness of his work. His

employment may, upon most occasions, be as constant as he pleases. The

coal-heavers in London exercise a trade which, in hardship, dirtiness,

and disagreeableness, almost equals that of colliers; and, from the

unavoidable irregularity in the arrivals of coal-ships, the employment

of the greater part of them is necessarily very inconstant. If colliers,

therefore, commonly earn double and triple the wages of common labour,

it ought not to seem unreasonable that coal-heavers should sometimes

earn four and five times those wages. In the inquiry made into their

condition a few years ago, it was found that, at the rate at which they

were then paid, they could earn from six to ten shillings a-day. Six

shillings are about four times the wages of common labour in London;

and, in every particular trade, the lowest common earnings may always

be considered as those of the far greater number. How extravagant

soever those earnings may appear, if they were more than sufficient to

compensate all the disagreeable circumstances of the business, there

would soon be so great a number of competitors, as, in a trade which has

no exclusive privilege, would quickly reduce them to a lower rate.

The constancy or inconstancy of employment cannot affect the ordinary

profits of stock in any particular trade. Whether the stock is or is not

constantly employed, depends, not upon the trade, but the trader.

Fourthly, the wages of labour vary according to the small or great trust

which must be reposed in the workmen.

The wages of goldsmiths and jewellers are everywhere superior to

those of many other workmen, not only of equal, but of much superior

ingenuity, on account of the precious materials with which they are

entrusted. We trust our health to the physician, our fortune, and

sometimes our life and reputation, to the lawyer and attorney. Such

confidence could not safely be reposed in people of a very mean or low

condition. Their reward must be such, therefore, as may give them that

rank in the society which so important a trust requires. The long time

and the great expense which must be laid out in their education, when

combined with this circumstance, necessarily enhance still further the

price of their labour.

When a person employs only his own stock in trade, there is no trust;

and the credit which he may get from other people, depends, not upon the

nature of the trade, but upon their opinion of his fortune, probity and

prudence. The different rates of profit, therefore, in the different

branches of trade, cannot arise from the different degrees of trust

reposed in the traders.

Fifthly, the wages of labour in different employments vary according to

the probability or improbability of success in them.

The probability that any particular person shall ever be qualified for

the employments to which he is educated, is very different in different

occupations. In the greatest part of mechanic trades success is almost

certain; but very uncertain in the liberal professions. Put your son

apprentice to a shoemaker, there is little doubt of his learning to make

a pair of shoes; but send him to study the law, it as at least twenty to

one if he ever makes such proficiency as will enable him to live by the

business. In a perfectly fair lottery, those who draw the prizes ought

to gain all that is lost by those who draw the blanks. In a profession,

where twenty fail for one that succeeds, that one ought to gain all that

should have been gained by the unsuccessful twenty. The counsellor at

law, who, perhaps, at near forty years of age, begins to make something

by his profession, ought to receive the retribution, not only of his

own so tedious and expensive education, but of that of more than twenty

others, who are never likely to make any thing by it. How extravagant

soever the fees of counsellors at law may sometimes appear, their real

retribution is never equal to this. Compute, in any particular place,

what is likely to be annually gained, and what is likely to be annually

spent, by all the different workmen in any common trade, such as that

of shoemakers or weavers, and you will find that the former sum will

generally exceed the latter. But make the same computation with regard

to all the counsellors and students of law, in all the different Inns of

Court, and you will find that their annual gains bear but a very small

proportion to their annual expense, even though you rate the former as

high, and the latter as low, as can well be done. The lottery of the

law, therefore, is very far from being a perfectly fair lottery; and

that as well as many other liberal and honourable professions, is, in

point of pecuniary gain, evidently under-recompensed.

Those professions keep their level, however, with other occupations;

and, notwithstanding these discouragements, all the most generous and

liberal spirits are eager to crowd into them. Two different causes

contribute to recommend them. First, the desire of the reputation which

attends upon superior excellence in any of them; and, secondly, the

natural confidence which every man has, more or less, not only in his

own abilities, but in his own good fortune.

To excel in any profession, in which but few arrive at mediocrity, it

is the most decisive mark of what is called genius, or superior talents.

The public admiration which attends upon such distinguished abilities

makes always a part of their reward; a greater or smaller, in proportion

as it is higher or lower in degree. It makes a considerable part of that

reward in the profession of physic; a still greater, perhaps, in that of

law; in poetry and philosophy it makes almost the whole.

There are some very agreeable and beautiful talents, of which the

possession commands a certain sort of admiration, but of which the

exercise, for the sake of gain, is considered, whether from reason or

prejudice, as a sort of public prostitution. The pecuniary recompence,

therefore, of those who exercise them in this manner, must be

sufficient, not only to pay for the time, labour, and expense of

acquiring the talents, but for the discredit which attends the

employment of them as the means of subsistence. The exorbitant rewards

of players, opera-singers, opera-dancers, etc. are founded upon those

two principles; the rarity and beauty of the talents, and the discredit

of employing them in this manner. It seems absurd at first sight, that

we should despise their persons, and yet reward their talents with

the most profuse liberality. While we do the one, however, we must of

necessity do the other, Should the public opinion or prejudice ever

alter with regard to such occupations, their pecuniary recompence would

quickly diminish. More people would apply to them, and the competition

would quickly reduce the price of their labour. Such talents, though

far from being common, are by no means so rare as imagined. Many people

possess them in great perfection, who disdain to make this use of them;

and many more are capable of acquiring them, if any thing could be made

honourably by them.

The over-weening conceit which the greater part of men have of their own

abilities, is an ancient evil remarked by the philosophers and moralists

of all ages. Their absurd presumption in their own good fortune has been

less taken notice of. It is, however, if possible, still more universal.

There is no man living, who, when in tolerable health and spirits, has

not some share of it. The chance of gain is by every man more or less

over-valued, and the chance of loss is by most men under-valued, and by

scarce any man, who is in tolerable health and spirits, valued more than

it is worth.

That the chance of gain is naturally overvalued, we may learn from the

universal success of lotteries. The world neither ever saw, nor ever

will see, a perfectly fair lottery, or one in which the whole gain

compensated the whole loss; because the undertaker could make nothing by

it. In the state lotteries, the tickets are really not worth the price

which is paid by the original subscribers, and yet commonly sell in the

market for twenty, thirty, and sometimes forty per cent. advance. The

vain hopes of gaining some of the great prizes is the sole cause of

this demand. The soberest people scarce look upon it as a folly to pay

a small sum for the chance of gaining ten or twenty thousand pounds,

though they know that even that small sum is perhaps twenty or thirty

per cent. more than the chance is worth. In a lottery in which no prize

exceeded twenty pounds, though in other respects it approached much

nearer to a perfectly fair one than the common state lotteries, there

would not be the same demand for tickets. In order to have a better

chance for some of the great prizes, some people purchase several

tickets; and others, small shares in a still greater number. There is

not, however, a more certain proposition in mathematics, than that the

more tickets you adventure upon, the more likely you are to be a loser.

Adventure upon all the tickets in the lottery, and you lose for certain;

and the greater the number of your tickets, the nearer you approach to

this certainty.

That the chance of loss is frequently undervalued, and scarce ever

valued more than it is worth, we may learn from the very moderate profit

of insurers. In order to make insurance, either from fire or sea-risk,

a trade at all, the common premium must be sufficient to compensate the

common losses, to pay the expense of management, and to afford such a

profit as might have been drawn from an equal capital employed in any

common trade. The person who pays no more than this, evidently pays no

more than the real value of the risk, or the lowest price at which he

can reasonably expect to insure it. But though many people have made a

little money by insurance, very few have made a great fortune; and,

from this consideration alone, it seems evident enough that the ordinary

balance of profit and loss is not more advantageous in this than in

other common trades, by which so many people make fortunes. Moderate,

however, as the premium of insurance commonly is, many people despise

the risk too much to care to pay it. Taking the whole kingdom at an

average, nineteen houses in twenty, or rather, perhaps, ninety-nine in

a hundred, are not insured from fire. Sea-risk is more alarming to the

greater part of people; and the proportion of ships insured to those not

insured is much greater. Many sail, however, at all seasons, and even in

time of war, without any insurance. This may sometimes, perhaps, be done

without any imprudence. When a great company, or even a great merchant,

has twenty or thirty ships at sea, they may, as it were, insure one

another. The premium saved up on them all may more than compensate such

losses as they are likely to meet with in the common course of chances.

The neglect of insurance upon shipping, however, in the same manner as

upon houses, is, in most cases, the effect of no such nice calculation,

but of mere thoughtless rashness, and presumptuous contempt of the risk.

The contempt of risk, and the presumptuous hope of success, are in no

period of life more active than at the age at which young people choose

their professions. How little the fear of misfortune is then capable

of balancing the hope of good luck, appears still more evidently in the

readiness of the common people to enlist as soldiers, or to go to sea,

than in the eagerness of those of better fashion to enter into what are

called the liberal professions.

What a common soldier may lose is obvious enough. Without regarding

the danger, however, young volunteers never enlist so readily as at

the beginning of a new war; and though they have scarce any chance of

preferment, they figure to themselves, in their youthful fancies, a

thousand occasions of acquiring honour and distinction which never

occur. These romantic hopes make the whole price of their blood. Their

pay is less than that of common labourers, and, in actual service, their

fatigues are much greater.

The lottery of the sea is not altogether so disadvantageous as that of

the army. The son of a creditable labourer or artificer may frequently

go to sea with his father's consent; but if he enlists as a soldier,

it is always without it. Other people see some chance of his making

something by the one trade; nobody but himself sees any of his making

any thing by the other. The great admiral is less the object of public

admiration than the great general; and the highest success in the sea

service promises a less brilliant fortune and reputation than equal

success in the land. The same difference runs through all the inferior

degrees of preferment in both. By the rules of precedency, a captain in

the navy ranks with a colonel in the army; but he does not rank with him

in the common estimation. As the great prizes in the lottery are less,

the smaller ones must be more numerous. Common sailors, therefore, more

frequently get some fortune and preferment than common soldiers; and the

hope of those prizes is what principally recommends the trade. Though

their skill and dexterity are much superior to that of almost any

artificers; and though their whole life is one continual scene of

hardship and danger; yet for all this dexterity and skill, for all those

hardships and dangers, while they remain in the condition of common

sailors, they receive scarce any other recompence but the pleasure of

exercising the one and of surmounting the other. Their wages are not

greater than those of common labourers at the port which regulates the

rate of seamen's wages. As they are continually going from port to port,

the monthly pay of those who sail from all the different ports of Great

Britain, is more nearly upon a level than that of any other workmen in

those different places; and the rate of the port to and from which the

greatest number sail, that is, the port of London, regulates that of

all the rest. At London, the wages of the greater part of the different

classes of workmen are about double those of the same classes at

Edinburgh. But the sailors who sail from the port of London, seldom earn

above three or four shillings a month more than those who sail from the

port of Leith, and the difference is frequently not so great. In time of

peace, and in the merchant-service, the London price is from a guinea to

about seven-and-twenty shillings the calendar month. A common labourer

in London, at the rate of nine or ten shillings a week, may earn in

the calendar month from forty to five-and-forty shillings. The sailor,

indeed, over and above his pay, is supplied with provisions. Their

value, however, may not perhaps always exceed the difference between his

pay and that of the common labourer; and though it sometimes should, the

excess will not be clear gain to the sailor, because he cannot share

it with his wife and family, whom he must maintain out of his wages at


The dangers and hair-breadth escapes of a life of adventures, instead

of disheartening young people, seem frequently to recommend a trade

to them. A tender mother, among the inferior ranks of people, is often

afraid to send her son to school at a sea-port town, lest the sight of

the ships, and the conversation and adventures of the sailors, should

entice him to go to sea. The distant prospect of hazards, from which

we can hope to extricate ourselves by courage and address, is not

disagreeable to us, and does not raise the wages of labour in any

employment. It is otherwise with those in which courage and address can

be of no avail. In trades which are known to be very unwholesome, the

wages of labour are always remarkably high. Unwholesomeness is a species

of disagreeableness, and its effects upon the wages of labour are to be

ranked under that general head.

In all the different employments of stock, the ordinary rate of profit

varies more or less with the certainty or uncertainty of the returns.

These are, in general, less uncertain in the inland than in the foreign

trade, and in some branches of foreign trade than in others; in the

trade to North America, for example, than in that to Jamaica. The

ordinary rate of profit always rises more or less with the risk. It does

not, however, seem to rise in proportion to it, or so as to compensate

it completely. Bankruptcies are most frequent in the most hazardous

trades. The most hazardous of all trades, that of a smuggler, though,

when the adventure succeeds, it is likewise the most profitable, is the

infallible road to bankruptcy. The presumptuous hope of success seems to

act here as upon all other occasions, and to entice so many adventurers

into those hazardous trades, that their competition reduces the profit

below what is sufficient to compensate the risk. To compensate it

completely, the common returns ought, over and above the ordinary

profits of stock, not only to make up for all occasional losses, but to

afford a surplus profit to the adventurers, of the same nature with the

profit of insurers. But if the common returns were sufficient for all

this, bankruptcies would not be more frequent in these than in other


Of the five circumstances, therefore, which vary the wages of

labour, two only affect the profits of stock; the agreeableness or

disagreeableness of the business, and the risk or security with which

it is attended. In point of agreeableness or disagreeableness, there

is little or no difference in the far greater part of the different

employments of stock, but a great deal in those of labour; and the

ordinary profit of stock, though it rises with the risk, does not always

seem to rise in proportion to it. It should follow from all this, that,

in the same society or neighbourhood, the average and ordinary rates of

profit in the different employments of stock should be more nearly upon

a level than the pecuniary wages of the different sorts of labour.

They are so accordingly. The difference between the earnings of a common

labourer and those of a well employed lawyer or physician, is evidently

much greater than that between the ordinary profits in any two different

branches of trade. The apparent difference, besides, in the profits of

different trades, is generally a deception arising from our not always

distinguishing what ought to be considered as wages, from what ought to

be considered as profit.

Apothecaries' profit is become a bye-word, denoting something uncommonly

extravagant. This great apparent profit, however, is frequently no more

than the reasonable wages of labour. The skill of an apothecary is a

much nicer and more delicate matter than that of any artificer whatever;

and the trust which is reposed in him is of much greater importance.

He is the physician of the poor in all cases, and of the rich when the

distress or danger is not very great. His reward, therefore, ought to

be suitable to his skill and his trust; and it arises generally from the

price at which he sells his drugs. But the whole drugs which the best

employed apothecary in a large market-town, will sell in a year, may

not perhaps cost him above thirty or forty pounds. Though he should sell

them, therefore, for three or four hundred, or at a thousand per cent.

profit, this may frequently be no more than the reasonable wages of his

labour, charged, in the only way in which he can charge them, upon the

price of his drugs. The greater part of the apparent profit is real

wages disguised in the garb of profit.

In a small sea-port town, a little grocer will make forty or fifty per

cent. upon a stock of a single hundred pounds, while a considerable

wholesale merchant in the same place will scarce make eight or ten

per cent. upon a stock of ten thousand. The trade of the grocer may be

necessary for the conveniency of the inhabitants, and the narrowness

of the market may not admit the employment of a larger capital in the

business. The man, however, must not only live by his trade, but live by

it suitably to the qualifications which it requires. Besides possessing

a little capital, he must be able to read, write, and account and must

be a tolerable judge, too, of perhaps fifty or sixty different sorts of

goods, their prices, qualities, and the markets where they are to be had

cheapest. He must have all the knowledge, in short, that is necessary

for a great merchant, which nothing hinders him from becoming but the

want of a sufficient capital. Thirty or forty pounds a year cannot

be considered as too great a recompence for the labour of a person

so accomplished. Deduct this from the seemingly great profits of his

capital, and little more will remain, perhaps, than the ordinary profits

of stock. The greater part of the apparent profit is, in this case too,

real wages.

The difference between the apparent profit of the retail and that of

the wholesale trade, is much less in the capital than in small towns

and country villages. Where ten thousand pounds can be employed in the

grocery trade, the wages of the grocer's labour must be a very trifling

addition to the real profits of so great a stock. The apparent profits

of the wealthy retailer, therefore, are there more nearly upon a level

with those of the wholesale merchant. It is upon this account that goods

sold by retail are generally as cheap, and frequently much cheaper, in

the capital than in small towns and country villages. Grocery goods, for

example, are generally much cheaper; bread and butchers' meat frequently

as cheap. It costs no more to bring grocery goods to the great town than

to the country village; but it costs a great deal more to bring corn and

cattle, as the greater part of them must be brought from a much greater

distance. The prime cost of grocery goods, therefore, being the same in

both places, they are cheapest where the least profit is charged upon

them. The prime cost of bread and butchers' meat is greater in the

great town than in the country village; and though the profit is less,

therefore they are not always cheaper there, but often equally cheap.

In such articles as bread and butchers' meat, the same cause which

diminishes apparent profit, increases prime cost. The extent of the

market, by giving employment to greater stocks, diminishes apparent

profit; but by requiring supplies from a greater distance, it increases

prime cost. This diminution of the one and increase of the other, seem,

in most cases, nearly to counterbalance one another; which is probably

the reason that, though the prices of corn and cattle are commonly

very different in different parts of the kingdom, those of bread and

butchers' meat are generally very nearly the same through the greater

part of it.

Though the profits of stock, both in the wholesale and retail trade, are

generally less in the capital than in small towns and country villages,

yet great fortunes are frequently acquired from small beginnings in

the former, and scarce ever in the latter. In small towns and country

villages, on account of the narrowness of the market, trade cannot

always be extended as stock extends. In such places, therefore, though

the rate of a particular person's profits may be very high, the sum or

amount of them can never be very great, nor consequently that of his

annual accumulation. In great towns, on the contrary, trade can be

extended as stock increases, and the credit of a frugal and thriving

man increases much faster than his stock. His trade is extended in

proportion to the amount of both; and the sum or amount of his profits

is in proportion to the extent of his trade, and his annual accumulation

in proportion to the amount of his profits. It seldom happens, however,

that great fortunes are made, even in great towns, by any one regular,

established, and well-known branch of business, but in consequence of

a long life of industry, frugality, and attention. Sudden fortunes,

indeed, are sometimes made in such places, by what is called the trade

of speculation. The speculative merchant exercises no one regular,

established, or well-known branch of business. He is a corn merchant

this year, and a wine merchant the next, and a sugar, tobacco, or tea

merchant the year after. He enters into every trade, when he foresees

that it is likely to lie more than commonly profitable, and he quits it

when he foresees that its profits are likely to return to the level of

other trades. His profits and losses, therefore, can bear no regular

proportion to those of any one established and well-known branch of

business. A bold adventurer may sometimes acquire a considerable fortune

by two or three successful speculations, but is just as likely to lose

one by two or three unsuccessful ones. This trade can be carried on

nowhere but in great towns. It is only in places of the most extensive

commerce and correspondence that the intelligence requisite for it can

be had.

The five circumstances above mentioned, though they occasion

considerable inequalities in the wages of labour and profits of stock,

occasion none in the whole of the advantages and disadvantages, real or

imaginary, of the different employments of either. The nature of those

circumstances is such, that they make up for a small pecuniary gain in

some, and counterbalance a great one in others.

In order, however, that this equality may take place in the whole of

their advantages or disadvantages, three things are requisite, even

where there is the most perfect freedom. First the employments must be

well known and long established in the neighbourhood; secondly, they

must be in their ordinary, or what may be called their natural state;

and, thirdly, they must be the sole or principal employments of those

who occupy them.

First, This equality can take place only in those employments which are

well known, and have been long established in the neighbourhood.

Where all other circumstances are equal, wages are generally higher in

new than in old trades. When a projector attempts to establish a new

manufacture, he must at first entice his workmen from other employments,

by higher wages than they can either earn in their own trades, or than

the nature of his work would otherwise require; and a considerable time

must pass away before he can venture to reduce them to the common level.

Manufactures for which the demand arises altogether from fashion and

fancy, are continually changing, and seldom last long enough to be

considered as old established manufactures. Those, on the contrary, for

which the demand arises chiefly from use or necessity, are less liable

to change, and the same form or fabric may continue in demand for whole

centuries together. The wages of labour, therefore, are likely to be

higher in manufactures of the former, than in those of the latter kind.

Birmingham deals chiefly in manufactures of the former kind; Sheffield

in those of the latter; and the wages of labour in those two different

places are said to be suitable to this difference in the nature of their


The establishment of any new manufacture, of any new branch of commerce,

or of any new practice in agriculture, is always a speculation from

which the projector promises himself extraordinary profits. These

profits sometimes are very great, and sometimes, more frequently,

perhaps, they are quite otherwise; but, in general, they bear no regular

proportion to those of other old trades in the neighbourhood. If the

project succeeds, they are commonly at first very high. When the

trade or practice becomes thoroughly established and well known, the

competition reduces them to the level of other trades.

Secondly, this equality in the whole of the advantages and disadvantages

of the different employments of labour and stock, can take place only

in the ordinary, or what may be called the natural state of those


The demand for almost every different species of labour is sometimes

greater, and sometimes less than usual. In the one case, the advantages

of the employment rise above, in the other they fall below the common

level. The demand for country labour is greater at hay-time and harvest

than during the greater part of the year; and wages rise with the

demand. In time of war, when forty or fifty thousand sailors are forced

from the merchant service into that of the king, the demand for sailors

to merchant ships necessarily rises with their scarcity; and

their wages, upon such occasions, commonly rise from a guinea and

seven-and-twenty shillings to forty shilling's and three pounds a-month.

In a decaying manufacture, on the contrary, many workmen, rather than

quit their own trade, are contented with smaller wages than would

otherwise be suitable to the nature of their employment.

The profits of stock vary with the price of the commodities in which it

is employed. As the price of any commodity rises above the ordinary or

average rate, the profits of at least some part of the stock that is

employed in bringing it to market, rise above their proper level, and as

it falls they sink below it. All commodities are more or less liable

to variations of price, but some are much more so than others. In

all commodities which are produced by human industry, the quantity

of industry annually employed is necessarily regulated by the annual

demand, in such a manner that the average annual produce may, as

nearly as possible, be equal to the average annual consumption. In some

employments, it has already been observed, the same quantity of industry

will always produce the same, or very nearly the same quantity of

commodities. In the linen or woollen manufactures, for example, the same

number of hands will annually work up very nearly the same quantity

of linen and woollen cloth. The variations in the market price of such

commodities, therefore, can arise only from some accidental variation

in the demand. A public mourning raises the price of black cloth. But

as the demand for most sorts of plain linen and woollen cloth is pretty

uniform, so is likewise the price. But there are other employments in

which the same quantity of industry will not always produce the same

quantity of commodities. The same quantity of industry, for example,

will, in different years, produce very different quantities of

corn, wine, hops, sugar tobacco, etc. The price of such commodities,

therefore, varies not only with the variations of demand, but with

the much greater and more frequent variations of quantity, and is

consequently extremely fluctuating; but the profit of some of the

dealers must necessarily fluctuate with the price of the commodities.

The operations of the speculative merchant are principally employed

about such commodities. He endeavours to buy them up when he foresees

that their price is likely to rise, and to sell them when it is likely

to fall.

Thirdly, this equality in the whole of the advantages and disadvantages

of the different employments of labour and stock, can take place only in

such as are the sole or principal employments of those who occupy them.

When a person derives his subsistence from one employment, which does

not occupy the greater part of his time, in the intervals of his

leisure he is often willing to work at another for less wages than would

otherwise suit the nature of the employment.

There still subsists, in many parts of Scotland, a set of people called

cottars or cottagers, though they were more frequent some years ago

than they are now. They are a sort of out-servants of the landlords

and farmers. The usual reward which they receive from their master is a

house, a small garden for pot-herbs, as much grass as will feed a cow,

and, perhaps, an acre or two of bad arable land. When their master has

occasion for their labour, he gives them, besides, two pecks of oatmeal

a-week, worth about sixteen pence sterling. During a great part of the

year, he has little or no occasion for their labour, and the cultivation

of their own little possession is not sufficient to occupy the time

which is left at their own disposal. When such occupiers were more

numerous than they are at present, they are said to have been willing

to give their spare time for a very small recompence to any body, and to

have wrought for less wages than other labourers. In ancient times, they

seem to have been common all over Europe. In countries ill cultivated,

and worse inhabited, the greater part of landlords and farmers could

not otherwise provide themselves with the extraordinary number of hands

which country labour requires at certain seasons. The daily or weekly

recompence which such labourers occasionally received from their

masters, was evidently not the whole price of their labour. Their

small tenement made a considerable part of it. This daily or weekly

recompence, however, seems to have been considered as the whole of it,

by many writers who have collected the prices of labour and provisions

in ancient times, and who have taken pleasure in representing both as

wonderfully low.

The produce of such labour comes frequently cheaper to market than

would otherwise be suitable to its nature. Stockings, in many parts of

Scotland, are knit much cheaper than they can anywhere be wrought upon

the loom. They are the work of servants and labourers who derive the

principal part of their subsistence from some other employment. More

than a thousand pair of Shetland stockings are annually imported into

Leith, of which the price is from fivepence to seven-pence a pair. At

Lerwick, the small capital of the Shetland islands, tenpence a-day,

I have been assured, is a common price of common labour. In the same

islands, they knit worsted stockings to the value of a guinea a pair and


The spinning of linen yarn is carried on in Scotland nearly in the same

way as the knitting of stockings, by servants, who are chiefly hired for

other purposes. They earn but a very scanty subsistence, who endeavour

to get their livelihood by either of those trades. In most parts of

Scotland, she is a good spinner who can earn twentypence a-week.

In opulent countries, the market is generally so extensive, that any one

trade is sufficient to employ the whole labour and stock of those who

occupy it. Instances of people living by one employment, and, at the

same time, deriving some little advantage from another, occur chiefly

in pour countries. The following instance, however, of something of the

same kind, is to be found in the capital of a very rich one. There is no

city in Europe, I believe, in which house-rent is dearer than in London,

and yet I know no capital in which a furnished apartment can be hired so

cheap. Lodging is not only much cheaper in London than in Paris; it is

much cheaper than in Edinburgh, of the same degree of goodness; and,

what may seem extraordinary, the dearness of house-rent is the cause of

the cheapness of lodging. The dearness of house-rent in London arises,

not only from those causes which render it dear in all great capitals,

the dearness of labour, the dearness of all the materials of building,

which must generally be brought from a great distance, and, above

all, the dearness of ground-rent, every landlord acting the part of a

monopolist, and frequently exacting a higher rent for a single acre of

bad land in a town, than can be had for a hundred of the best in the

country; but it arises in part from the peculiar manners and customs of

the people, which oblige every master of a family to hire a whole house

from top to bottom. A dwelling-house in England means every thing that

is contained under the same roof. In France, Scotland, and many other

parts of Europe, it frequently means no more than a single storey. A

tradesman in London is obliged to hire a whole house in that part of the

town where his customers live. His shop is upon the ground floor, and he

and his family sleep in the garret; and he endeavours to pay a part of

his house-rent by letting the two middle storeys to lodgers. He expects

to maintain his family by his trade, and not by his lodgers. Whereas

at Paris and Edinburgh, people who let lodgings have commonly no other

means of subsistence; and the price of the lodging must pay, not only

the rent of the house, but the whole expense of the family.

PART II.--Inequalities occasioned by the Policy of Europe.

Such are the inequalities in the whole of the advantages and

disadvantages of the different employments of labour and stock, which

the defect of any of the three requisites above mentioned must occasion,

even where there is the most perfect liberty. But the policy of Europe,

by not leaving things at perfect liberty, occasions other inequalities

of much greater importance.

It does this chiefly in the three following ways. First, by restraining

the competition in some employments to a smaller number than would

otherwise be disposed to enter into them; secondly, by increasing it in

others beyond what it naturally would be; and, thirdly, by obstructing

the free circulation of labour and stock, both from employment to

employment, and from place to place.

First, The policy of Europe occasions a very important inequality in the

whole of the advantages and disadvantages of the different employments

of labour and stock, by restraining the competition in some employments

to a smaller number than might otherwise be disposed to enter into them.

The exclusive privileges of corporations are the principal means it

makes use of for this purpose.

The exclusive privilege of an incorporated trade necessarily restrains

the competition, in the town where it is established, to those who are

free of the trade. To have served an apprenticeship in the town, under

a master properly qualified, is commonly the necessary requisite

for obtaining this freedom. The bye-laws of the corporation regulate

sometimes the number of apprentices which any master is allowed to have,

and almost always the number of years which each apprentice is

obliged to serve. The intention of both regulations is to restrain the

competition to a much smaller number than might otherwise be disposed

to enter into the trade. The limitation of the number of apprentices

restrains it directly. A long term of apprenticeship restrains it more

indirectly, but as effectually, by increasing the expense of education.

In Sheffield, no master cutler can have more than one apprentice at a

time, by a bye-law of the corporation. In Norfolk and Norwich, no master

weaver can have more than two apprentices, under pain of forfeiting

five pounds a-month to the king. No master hatter can have more than two

apprentices anywhere in England, or in the English plantations, under

pain of forfeiting; five pounds a-month, half to the king, and half to

him who shall sue in any court of record. Both these regulations, though

they have been confirmed by a public law of the kingdom, are evidently

dictated by the same corporation-spirit which enacted the bye-law of

Sheffield. The silk-weavers in London had scarce been incorporated a

year, when they enacted a bye-law, restraining any master from having

more than two apprentices at a time. It required a particular act of

parliament to rescind this bye-law.

Seven years seem anciently to have been, all over Europe, the usual term

established for the duration of apprenticeships in the greater part

of incorporated trades. All such incorporations were anciently

called universities, which, indeed, is the proper Latin name for any

incorporation whatever. The university of smiths, the university of

tailors, etc. are expressions which we commonly meet with in the old

charters of ancient towns. When those particular incorporations, which

are now peculiarly called universities, were first established, the term

of years which it was necessary to study, in order to obtain the degree

of master of arts, appears evidently to have been copied from the term

of apprenticeship in common trades, of which the incorporations were

much more ancient. As to have wrought seven years under a master

properly qualified, was necessary, in order to entitle my person to

become a master, and to have himself apprentices in a common trade;

so to have studied seven years under a master properly qualified, was

necessary to entitle him to become a master, teacher, or doctor (words

anciently synonymous), in the liberal arts, and to have scholars or

apprentices (words likewise originally synonymous) to study under him.

By the 5th of Elizabeth, commonly called the Statute of Apprenticeship,

it was enacted, that no person should, for the future, exercise any

trade, craft, or mystery, at that time exercised in England, unless he

had previously served to it an apprenticeship of seven years at least;

and what before had been the bye-law of many particular corporations,

became in England the general and public law of all trades carried on in

market towns. For though the words of the statute are very general,

and seem plainly to include the whole kingdom, by interpretation its

operation has been limited to market towns; it having been held that, in

country villages, a person may exercise several different trades, though

he has not served a seven years apprenticeship to each, they being

necessary for the conveniency of the inhabitants, and the number of

people frequently not being sufficient to supply each with a particular

set of hands. By a strict interpretation of the words, too, the

operation of this statute has been limited to those trades which were

established in England before the 5th of Elizabeth, and has never

been extended to such as have been introduced since that time. This

limitation has given occasion to several distinctions, which, considered

as rules of police, appear as foolish as can well be imagined. It has

been adjudged, for example, that a coach-maker can neither himself make

nor employ journeymen to make his coach-wheels, but must buy them of a

master wheel-wright; this latter trade having been exercised in England

before the 5th of Elizabeth. But a wheel-wright, though he has never

served an apprenticeship to a coachmaker, may either himself make or

employ journeymen to make coaches; the trade of a coachmaker not being

within the statute, because not exercised in England at the time when it

was made. The manufactures of Manchester, Birmingham, and Wolverhampton,

are many of them, upon this account, not within the statute, not having

been exercised in England before the 5th of Elizabeth.

In France, the duration of apprenticeships is different in different

towns and in different trades. In Paris, five years is the term required

in a great number; but, before any person can be qualified to exercise

the trade as a master, he must, in many of them, serve five years more

as a journeyman. During this latter term, he is called the companion of

his master, and the term itself is called his companionship.

In Scotland, there is no general law which regulates universally

the duration of apprenticeships. The term is different in different

corporations. Where it is long, a part of it may generally be redeemed

by paying a small fine. In most towns, too, a very small fine is

sufficient to purchase the freedom of any corporation. The weavers of

linen and hempen cloth, the principal manufactures of the country,

as well as all other artificers subservient to them, wheel-makers,

reel-makers, etc. may exercise their trades in any town-corporate

without paying any fine. In all towns-corporate, all persons are free to

sell butchers' meat upon any lawful day of the week. Three years is,

in Scotland, a common term of apprenticeship, even in some very nice

trades; and, in general, I know of no country in Europe, in which

corporation laws are so little oppressive.

The property which every man has in his own labour, as it is the

original foundation of all other property, so it is the most sacred

and inviolable. The patrimony of a poor man lies in the strength and

dexterity of his hands; and to hinder him from employing this strength

and dexterity in what manner he thinks proper, without injury to his

neighbour, is a plain violation of this most sacred property. It is a

manifest encroachment upon the just liberty, both of the workman, and

of those who might be disposed to employ him. As it hinders the one

from working at what he thinks proper, so it hinders the others from

employing whom they think proper. To judge whether he is fit to be

employed, may surely be trusted to the discretion of the employers,

whose interest it so much concerns. The affected anxiety of the

lawgiver, lest they should employ an improper person, is evidently as

impertinent as it is oppressive.

The institution of long apprenticeships can give no security that

insufficient workmanship shall not frequently be exposed to public

sale. When this is done, it is generally the effect of fraud, and not of

inability; and the longest apprenticeship can give no security against

fraud. Quite different regulations are necessary to prevent this abuse.

The sterling mark upon plate, and the stamps upon linen and woollen

cloth, give the purchaser much greater security than any statute of

apprenticeship. He generally looks at these, but never thinks it

worth while to enquire whether the workman had served a seven years


The institution of long apprenticeships has no tendency to form young

people to industry. A journeyman who works by the piece is likely to

be industrious, because he derives a benefit from every exertion of his

industry. An apprentice is likely to be idle, and almost always is so,

because he has no immediate interest to be otherwise. In the inferior

employments, the sweets of labour consist altogether in the recompence

of labour. They who are soonest in a condition to enjoy the sweets of

it, are likely soonest to conceive a relish for it, and to acquire the

early habit of industry. A young man naturally conceives an aversion to

labour, when for a long time he receives no benefit from it. The boys

who are put out apprentices from public charities are generally bound

for more than the usual number of years, and they generally turn out

very idle and worthless.

Apprenticeships were altogether unknown to the ancients. The reciprocal

duties of master and apprentice make a considerable article in every

modern code. The Roman law is perfectly silent with regard to them. I

know no Greek or Latin word (I might venture, I believe, to assert

that there is none) which expresses the idea we now annex to the word

apprentice, a servant bound to work at a particular trade for the

benefit of a master, during a term of years, upon condition that the

master shall teach him that trade.

Long apprenticeships are altogether unnecessary. The arts, which are

much superior to common trades, such as those of making clocks and

watches, contain no such mystery as to require a long course of

instruction. The first invention of such beautiful machines, indeed, and

even that of some of the instruments employed in making them, must no

doubt have been the work of deep thought and long time, and may justly

be considered as among the happiest efforts of human ingenuity. But when

both have been fairly invented, and are well understood, to explain to

any young man, in the completest manner, how to apply the instruments,

and how to construct the machines, cannot well require more than the

lessons of a few weeks; perhaps those of a few days might be sufficient.

In the common mechanic trades, those of a few days might certainly be

sufficient. The dexterity of hand, indeed, even in common trades, cannot

be acquired without much practice and experience. But a young man would

practice with much more diligence and attention, if from the beginning

he wrought as a journeyman, being paid in proportion to the little work

which he could execute, and paying in his turn for the materials which

he might sometimes spoil through awkwardness and inexperience. His

education would generally in this way be more effectual, and always less

tedious and expensive. The master, indeed, would be a loser. He would

lose all the wages of the apprentice, which he now saves, for seven

years together. In the end, perhaps, the apprentice himself would be a

loser. In a trade so easily learnt he would have more competitors, and

his wages, when he came to be a complete workman, would be much less

than at present. The same increase of competition would reduce the

profits of the masters, as well as the wages of workmen. The trades, the

crafts, the mysteries, would all be losers. But the public would be a

gainer, the work of all artificers coming in this way much cheaper to


It is to prevent his reduction of price, and consequently of wages and

profit, by restraining that free competition which would most certainly

occasion it, that all corporations, and the greater part of corporation

laws have been established. In order to erect a corporation, no other

authority in ancient times was requisite, in many parts of Europe, but

that of the town-corporate in which it was established. In England,

indeed, a charter from the king was likewise necessary. But this

prerogative of the crown seems to have been reserved rather for

extorting money from the subject, than for the defence of the common

liberty against such oppressive monopolies. Upon paying a fine to the

king, the charter seems generally to have been readily granted; and when

any particular class of artificers or traders thought proper to act as

a corporation, without a charter, such adulterine guilds, as they were

called, were not always disfranchised upon that account, but obliged

to fine annually to the king, for permission to exercise their usurped

privileges {See Madox Firma Burgi p. 26 etc.}. The immediate inspection

of all corporations, and of the bye-laws which they might think proper

to enact for their own government, belonged to the town-corporate in

which they were established; and whatever discipline was exercised

over them, proceeded commonly, not from the king, but from that greater

incorporation of which those subordinate ones were only parts or


The government of towns-corporate was altogether in the hands of traders

and artificers, and it was the manifest interest of every particular

class of them, to prevent the market from being overstocked, as they

commonly express it, with their own particular species of industry;

which is in reality to keep it always understocked. Each class was eager

to establish regulations proper for this purpose, and, provided it was

allowed to do so, was willing to consent that every other class should

do the same. In consequence of such regulations, indeed, each class was

obliged to buy the goods they had occasion for from every other within

the town, somewhat dearer than they otherwise might have done. But, in

recompence, they were enabled to sell their own just as much dearer; so

that, so far it was as broad as long, as they say; and in the dealings

of the different classes within the town with one another, none of them

were losers by these regulations. But in their dealings with the country

they were all great gainers; and in these latter dealings consist the

whole trade which supports and enriches every town.

Every town draws its whole subsistence, and all the materials of its

industry, from the: country. It pays for these chiefly in two ways.

First, by sending back to the country a part of those materials wrought

up and manufactured; in which case, their price is augmented by the

wages of the workmen, and the profits of their masters or immediate

employers; secondly, by sending to it a part both of the rude and

manufactured produce, either of other countries, or of distant parts

of the same country, imported into the town; in which case, too, the

original price of those goods is augmented by the wages of the carriers

or sailors, and by the profits of the merchants who employ them. In what

is gained upon the first of those branches of commerce, consists the

advantage which the town makes by its manufactures; in what is gained

upon the second, the advantage of its inland and foreign trade. The

wages of the workmen, and the profits of their different employers,

make up the whole of what is gained upon both. Whatever regulations,

therefore, tend to increase those wages and profits beyond what they

otherwise: would be, tend to enable the town to purchase, with a smaller

quantity of its labour, the produce of a greater quantity of the labour

of the country. They give the traders and artificers in the town an

advantage over the landlords, farmers, and labourers, in the country,

and break down that natural equality which would otherwise take place in

the commerce which is carried on between them. The whole annual produce

of the labour of the society is annually divided between those two