A. Type of equipment 45. The use of old machinery instead of modern equipment,


A. Type of equipment
45. The use of old machinery instead of modern
equipment, if it is viewed apart from the influence of
any other factor, increases labour consumption by approximately 33 per cent in the spinning mills, 164 per
cent in the weaving mills, and by 106 per cent as an
average for both sectors of the industry22 (table 1). In
other words, if an old, well-organized spinning and
weaving factory acquires modern equipment and readapts its organization to the new machinery, it would
more than double labour productivity.
46. In the case of spinning mills, the influence of the
type of equipment (133) is of very little importance,
compared to the joint effect of all the other factors—
even in Peru, where the indices for these other factors
(197)23 are extremely low in comparison with those of
the rest of the countries.

 This is because modern machinery in the spinning mills differs very little from the
old type of equipment, as regards both production per
unit of equipment and the number of workers required
per unit of equipment. In the analysis of the indices of
the type of equipment in the spinning mills, it will be
seen that the difference in labour consumption between
old and modern machinery generally arises from an increase of 6 per cent (106) in the output per spindle
and a decrease of 20 per cent (125) in the number of
workers required.
47. In the weaving mills, on the contrary, the influence
of the type of equipment on labour consumption is of
considerable importance (264). 

In two of the countries
(Mexico and Peru) it is more important than the total
of the remaining factors, but in the other two countries
(Brazil and Ecuador) it is not as dominant, because of
the great administrative deficiencies in the mills. As may
be seen from the analysis of the indices for the type of
equipment, the difference in productivity between the
old and modern weaving machinery arises from a relatively low gain in the output per loom (26 per cent) and
a considerable labour saving per unit of equipment
(52.4 per cent),24 principally due to the fact that the
looms are automatic.
48. If all the spinning and weaving mills of the country are considered as a single unit, or if it is assumed
that the two processes are integrated in the same old
manufacturing units, it would be equally important to
modernize both sectors of the industry because the
proper functioning of the automatic looms requires high
quality yarn (uniformity, cleanliness and strength), 

which cannot be produced on the antiquated and out22 As has been explained in the chapter on methodology, these
figures are purely theoretical and have been calculated by comparing the productivity of old and modern hypothetical mills,
•both of which have optimum organization for each type of
equipment. The small differences between the indices of the
countries are due to differences in the types of products, which
cause variations in the effect of old equipment on productivity.
" Obtained by the product of the indices for size (121) and
those for operation (164).
24 52.4 per cent equals (1 — 100.
28 In this report, the optimum size for Latin-American mills
-was considered to be probably between the limits of 25,000 and
50,000 spindles for the spinning mills, and 500 to 1,000 looms for
the weaving mills. In the chapter on methodology, the reasons
for this opinion have been set forth and the theoretical effect of
worn machinery installed, even though this could be
satisfactorily used from the point of view of labour
B. Small size of the mills
49. The textile factories in the countries visited are
small, as compared with the lower limit of size which
would enable them to attain the best productivity possible.25 The general average size is 9,600 spindles and
230 looms, but the average for individual countries
varies from 4,150 spindles and 145 looms in Ecuador
to 12,400 spindles and 314 looms in Brazil. The influence
of size on the group of mills as a whole, were it to
operate independently of other factors, would involve
an increase of 11 per cent in labour consumption in the
spinning mills and 2 per cent in the weaving mills.26
50. Though the values of these indices are not very
high, it is significant that the deficiencies to which they
correspond are practically of a structural order, requiring a long period for their elimination; this can only be
achieved through the joint action of the industry as a
whole. It is also important to note that the new textile
mills being built are of low capacity; this is especially
important if one takes into account the fact that small
size affects the modern units relatively more than the
older ones, owing to the fact that in the former, the
degree of labour specialization is more responsive to
variations of size.27 Among the new mills visited during
the course of this investigation, many cases were encountered in which the smallness of size caused a loss of
nearly all the advantages of productivity which might
potentially be derived from the modernity of the installations.
51. The principal cause for the small size of the
textile mills in the countries visited is the lack of capital
concentration in the hands of a single firm. This can be
ascribed to the characteristic individualism of many
Latin-American manufacturers. The limited size of the
market, which is frequently referred to as another of
the main causes, has no general importance in this connexion (except probably in Ecuador), because the volume of domestic demand for textiles is several times
greater than total production of an optimum size mill
and, moreover, because the types of fabric which are
produced in the greatest quantity are very similar to
one another. In the manufacturing of fine and fancy
fabrics, which are only consumed in small quantities in
these countries, the existence of small mills can be justified even from the point of view of productivity, because
flexibility in changing the type of production, which is
the most important characteristic of this type of mill,
the differences of size on productivity have been calculated with
reference to the lower limits.
26 These figures are the weighted averages of the influence of
small size in the mills of the countries visited. They were all
calculated as being old, because there were not sufficient data
with which to discriminate. However, owing to the high percentage of old equipment installed, it is not believed that they
vary much from the correct values. The small differences between these figures and the indices of table 1 are due to the fact
that it was not possible to obtain a sample which was entirely
representative of the universe as regards size.
17 The average size of the modern factories in the sample
(10,000 spindles and 325 looms, approximately) is slightly larger
than the average size of the industry, as a whole. However, the
effect of size is much more important in the sample of modern
factories than it is for the group of mills as a whole, as may be
seen from table 2.
Chapter I. Productivity in the ; Group of Countries Visited 7
does not allow a very high degree of labour specialization
to be attained, even when the capacity of mills is very
C. Operation in the old mills
52. In this section, reference is made to all the low
productivity factors in the old mills, excepting the type
of equipment and the small size of the installations. It
includes principally the causes which can be corrected
by good organization and internal administration of the
factories, but it also takes in others of less importance,
not covered by administrative action (of the manufacturers in co-operation with labour), either because they
demand the investment of large sums (such as for the
irreparable deterioration of machinery), or because they
depend upon the joint administrative action of the whole
industry and of the government (such as the poor
quality of the cotton and the lack of specialization in
53. As is shown diagrammatically in table 1, the factors of operation were divided into two groups, the first
of which includes abnormalities in the output of the
machinery, apart from the amount of labour allocated
to it; and the second, comprised of abnormalities in the
amount of labour employed in the textile processes, independently of the volume of production yielded by the
54. Excess labour in relation to the corresponding
amount in a normal or standard organization has a far
greater effect on productivity than the deficiencies in the
yield of the machinery. In fact, table 1 shows that the
average importance of excess labour in the old spinning
and weaving mills of all the countries together is 196
(96 per cent labour excess), as compared with the average importance of the deficient output of the machinery,
which is only 118 (15 per cent lower yield than normal).28
55. It is interesting to note that though there is an
excess of labour in all the sectors—it varies between 28
per cent (index 128) in the Mexican weaving mills and
575 (index 675) in Ecuador—there are no deficiencies
in the output of machinery in all the sectors. In many
industries, as is shown by the indices which are lower
than 100, higher equipment yields are being obtained
than those which might normally be expected, that is to
say, production is being forced from the machines. These
are being worked at the highest possible speed and
their period of inactivity is reduced to a minimum; intermediary products, with a heavier unit weight than is
suitable in order to obtain a better quality, are being
used on these machines.29
56. As will be seen below, in order to force production, especially in the mills in which the condition of the
equipment is bad, it is necessary to employ a considerably
2815percent = (1 --jjg ) 100.
29 See the analysis of the indices corresponding to the differences in the output of the machinery in their three constituent
parts, that is, the indices of the abnormality of unit weight, of
speed and of efficiency

. It will be seen that the two first indices
are mostly about 100 or a little below this figure, which shows
that the unit weight of the intermediary products and the speed
of the machinery are fairly close to, though generally a little
higher than, normal. The efficiency of the process is well below
normal, but in the detailed study of its causes, in each of the
countries, it is found that though efficiency is low, it is better
greater amount of labour than would be required under
normal circumstances. Therefore, the difference between
the indices of the importance of the output of the machinery and the excess of labour may be taken as an indication of the existence of a Latin-American industrial
policy, which is consistently attempting to draw the
greatest advantage possible from the scarce element,
namely, equipment, at the cost of wastage of the abundant factor, namely, labour, without the quality of the
products being of sufficient importance to offset the results of this policy.
57. Despite the manufacturer's wish to obtain the
highest yield possible from equipment, this cannot be
done in every case, owing to a number of defective manufacturing conditions, mainly affecting the efficiency of
the processes, that is to say, hindering the actual output
from reaching the level which might be expected from
machinery operating at the speeds, and with the unit
weights of the product, that have been correctly or incorrectly adopted.30 These defective conditions not only
diminish efficiency but also demand more labour than is
normal, in order to obtain the present rate of efficiency.
In certain cases, the deficiency of manufacturing conditions also affects the speed of machinery or the organization of the processes, as will be shown below.
58. The following list covers some of the manufacturing conditions which are most commonly found to
affect productivity in the old textile industry:
(a) The physical condition of the equipment is very
deficient in the majority of the mills. This is largely due
to natural deterioration caused by many years of constant use, but the lack of an adequate maintenance service is probably even more important. It is common to
find card-clothings which should have been replaced
long before; rolls of spinning frames requiring recovering; machines which are entirely off level; eccentric
spindles, and looms which have been repaired with bits
of wire. Very few mills have any systematic maintenance programme, that is, a frequent and regular inspection of the machinery and its complete overhauling for
repairs, cleaning and adjustment. The practice of looking after the equipment in an emergency is far more
current than the adoption of any preventive measures.
These conditions are responsible for the poor quality of
the intermediary and final products, causing stoppages
due to mechanical breakdowns, and lowering efficiency
in the processes. As has been said, low efficiency is frequently checked, or an attempt is made to check it, by
increasing the number of workers allocated to each machine. In Brazil there are various cases in which the
speed of some of the machines has been lowered in order
to offset some of the effects of their bad physical condition.

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