Academic journal article
By Hooker, Clarence
Journal of American Culture (Malden, MA) , Vol. 20, No. 1
This paper focuses on two aspects of the system of personnel management created and implemented in the Ford Motor Company (FMC) from c.1910 to 1917; popularly known as the FIVE DOLLAR DAY, this system of management had a tremendous impact on Ford workers, on the City of Highland Park and the greater metropolitan area of Detroit, Michigan. The underlying question guiding this paper is, what role the management system at the FMC had in determining popular culture in Ford's Highland Park plant (also known as the Crystal Palace), and in the City of Highland Park, Michigan.
There is no doubt that the major event in the social history of Highland Park was the announcement of the profit-sharing plan, better known as the FIVE DOLLAR DAY. Samuel Marquis referred to the plan as the "granddaddy of company-initiated reform plans," and explained that the plan involved rationalizing the Ford employment and wage structure by reducing the number of job categories, by regularizing pay scales, by reducing the foreman's power to hire and fire employees, and by raising the pay of certain classes of employees to a five-dollar minimum.1 As initially conceived, the profit-sharing plan supplemented and extended earlier reforms that had been aimed at making the administration of the Ford factory more efficient. In contrast to John R. Lee's reforms of October 1913 emphasizing the more scientific management of labor, the Five Dollar Day added the extra dimension of welfare-work to the industrial betterment program of the company.2
It was on Monday afternoon of January 5, 1914, when the announcement of the plan came with much fanfare. The press release explained that the foundation of this revolutionary plan was a profit-sharing program that would increase the minimum daily wage of qualified workers to five dollars; it was also noted that three eight-hour shifts would replace the existing two nine-hour shifts, and that 4,000 more workers would be added to the existing workforce of 15,000.3
In a manner of speaking, Ford profit-sharing was like much of the welfare work that was common during the early decades of the twentieth century. Rooted in the intellectual traditions of the Social Gospel and Progressivism, and known as "industrial betterment" and "industrial welfare work," the Ford plan had several components. As described by the National Civic Federation, welfare-work or industrial betterment programs of the era involved "special consideration for physical comfort wherever labor is performed; opportunities for recreation; educational advantages; the providing of suitable sanitary homes...plans for saving and lending money, and provisions for insurance and pensions."4 In short, welfare work was aimed at improving the culture of industrial workers and their families.
The stated objectives of Ford's plan paralleled the definition of the National Civic Foundation, and in this regard, the FMC was like many other companies. But, the FMC was also different from other companies in several important ways; major differences were the zeal, the absolute conviction and arrogance with which Ford's Sociological Department pursued its objectives. The Health and Safety program within the Crystal Palace, the effort to upgrade the "home and housing conditions," and the "Americanization" program are excellent examples of Ford's commitment to molding the culture of Ford workers.
The adoption of this plan was, in part, motivated by the desire to (1) increase efficiency in production, and therefore increase profits by reducing the rate of turnover in the labor force; (2) by the desire to give workers a "stake" in contributing to the increased production while re-shaping the workforce to suit the needs of the new industrial system; (3) and by the desire to upgrade the quality of life of the workforce. Regarding some of the results attributed to the profitsharing plan, one official said that the Ford Motor Company made more cars and greater earnings than ever before; hence, reasoned the official, there could be no doubt that the Five-Dollar Day was the greatest success for the Ford Motor Company and its workers. …